For thousands of years, gold has been a symbol of wealth and a reliable store of value. Its intrinsic value, scarcity and universal acceptance make it a cornerstone of the global financial system. Despite the emergence of modern currencies and financial instruments, gold remains a safe haven in times of economic uncertainty.

Moreover, the current global economic structure is being restructured, and there will be a short period of increasing volatility and uncertainty before the new structure is finalized. Central banks are experimenting with unconventional monetary policies, and traditional financial systems are also being tested. In particular, the global political and financial situation is even more precarious at this time. In such a situation, gold stands out as a reliable store of value.

At this time, Tether released Tether Gold, a new stablecoin, which is linked to gold. It combines the stability and credibility of traditional assets with the flexibility and efficiency of digital currencies. I should add that Tether Gold is not a new invention, but a digital stablecoin created by combining blockchain technology with traditional value systems, linked to the lasting value of gold. People should also actively look for ways to store their wealth at this time.

Image source: Unsplash

Benefits of pegging Tether Gold to gold

Stability and security: Gold has historically maintained its value, providing a stable asset base for Tether Gold. This stability is crucial in the volatile world of cryptocurrencies.

Transparency: Blockchain technology ensures that all transactions involving Tether Gold are transparent and immutable. Investors can verify the existence and amount of gold behind their tokens at any time.

Accessibility: Tether Gold makes gold accessible to a wider audience. Investors do not have to deal with the logistics and security issues of physical gold and can easily buy, sell and trade gold-backed tokens.

Liquidity: Tether Gold can be traded on a variety of cryptocurrency exchanges, providing liquidity that is typically lacking in the physical gold market. This liquidity makes it easier for investors to quickly enter and exit positions.

Efficiency: Traditional gold investments can involve high transaction costs and delays. Thanks to blockchain technology, Tether Gold transactions are fast and cost-effective.

So, this article will take you to learn about this recently released stablecoin pegged to gold, XAU₮.

What is Tether Gold?

Tether Gold (XAU₮) is a digital asset offered by Tether, the company behind the popular stablecoin USDT. Each Tether Gold token represents one troy ounce of gold on a London Good Delivery gold bar. The gold behind each token is stored in secure vaults, and token holders can verify the existence of the gold and their ownership through Tether's transparent platform. This combination of blockchain technology and gold offers a unique blend of old and new technologies, providing investors with a secure, transparent and accessible way to hold gold.

Tether Gold (XAU₮) is a product that combines the advantages of physical and digital assets, allowing holders to own physical gold in the form of digital tokens.

Introduced in 2020 by TG Commodities Limited, Tether Gold (XAU₮) is a stablecoin that provides ownership of one ounce of pure gold on a physical gold bar that meets the London Bullion Market Association (LBMA) Good Delivery standards, in a 1:1 ratio. This technology allows access to a stablecoin that provides ownership of physical gold while avoiding the disadvantages associated with physical gold, such as high storage costs and limited accessibility.

Note: XAU₮ tokens are available to 6 decimal places (i.e. in increments as small as 0.000001 troy ounce).

Each XAU₮ token represents ownership of one ounce of physical gold on a specific bar. XAU₮ is available as an ERC-20 token on the Ethereum blockchain and a TRC20 token on the TRON blockchain, and can be transferred from the purchaser's Tether wallet to any on-chain address. In addition, Tether Gold (XAU₮) is the only product among competing products that offers zero custody fees and direct control over the storage of physical gold, securely stored in Swiss vaults with best-in-class security and anti-threat measures. Today, Tether Gold (XAU₮) is the best way to hold gold.

In addition to the official website, there are many trading platforms that have listed XAUT.

Image source:gold.tether.to

Tether Launches New Platform Alloy - Fusion of USD and Gold into Digital Assets

Tether’s Alloy innovatively links stability to physical reserves of Tether Gold in Swiss vaults. Smart contracts ensure transparency in minting aUSD₮, and value integrity is monitored by Price Oracles. Alloy provides secure gold-backed digital assets for individuals and institutions.

Tether, the issuer of the world’s largest stablecoin, is launching Alloy, a new digital asset platform that combines the stability of the U.S. dollar with the security of gold.

The first token on the platform, aUSD₮, is backed by physical gold reserves held in Switzerland, Tether Gold (XAU₮).

Developed by Tether subsidiaries Moon Gold NA, S.A. de C.V. and Moon Gold El Salvador, S.A. de C.V., Alloy introduces the concept of “bound assets.”

These assets are designed to track the value of reference assets such as the U.S. dollar through overcollateralization and secondary market liquidity pools.

aUSD₮ is the first token on the platform, pegged to the US dollar and backed by Tether Gold (XAU₮). This allows users to trade, pay, and remit using a digital currency that is comparable to the stability of the US dollar without having to sell their gold holdings.

Alloy runs on the Ethereum mainnet and uses smart contracts to mint aUSD₮ tokens. Users can deposit Tether Gold as collateral, a process managed by Ethereum-compatible smart contracts.

These contracts maintain the integrity of the system through price oracles that continuously monitor the collateralization ratio.

The platform is designed to be open, allowing for the development of a variety of bonded assets with different backing mechanisms, including potential yield products.

This flexibility extends its use from individuals to institutional investors seeking secure, gold-backed digital assets for their portfolios.

Tether CEO Paolo Ardoino expressed his excitement about the launch of Alloy, highlighting its role in fusing digital innovation with the stability of gold-backed assets.

He highlighted its potential impact on the market and hinted at future integration in the Tether tokenization platform.

image source: tether.gold.to

Tether Gold Current Advantages

Tether Gold tokens provide indivisible ownership of gold on a designated bar. The allocated gold is identifiable by a unique serial number, purity, and weight, so XAU₮ holders can easily check the details of the gold bar associated with their address.

Owning physical assets on the blockchain gives you the combined advantages of physical and digital assets. As a XAUt token holder, you will be able to enjoy the ownership of gold while avoiding the disadvantages associated with physical gold, such as high storage costs and limited accessibility.

Another advantage is the continuous availability of digital tokens. Tether Gold tokens can be purchased on a market that operates 24 hours a day, 7 days a week. This means that when the traditional gold market is closed, Tether Gold tokens can still be purchased or sold.

Differences between Tether, Tether Tokens, Tether Gold, and Tether Gold (XAU₮)

Launched in 2014, Tether (tether.to) is a blockchain-based platform designed to facilitate the digital use of fiat currencies. Tether is committed to disrupting the traditional financial system through a more modern approach to money. More information can be found here.

Tether tokens are stablecoins that are pegged 1:1 to a matching fiat currency and are 100% backed by Tether's reserves (e.g., 1 USD₮ = 1 USD). These assets are called stablecoins because they are pegged to a fiat currency and therefore have price stability. Tether tokens provide traders, merchants, and funds with a low volatility solution when exiting market positions.

Available Tether tokens include:

Tether tokens pegged to the US dollar (USD₮);

Tether tokens pegged to the euro (EUR₮);

Tether tokens pegged to the CNH (CNH₮);

Tether tokens pegged to the MXN (MXN₮).

Gold Price Near-Term Forecast

Predicting the future price of gold involves analyzing a variety of factors, including economic indicators, geopolitical events, and market sentiment. Historically, gold has performed well during periods of economic uncertainty and inflation. As the global economy faces challenges such as rising debt levels, geopolitical tensions, and potential inflationary pressures, many analysts believe that gold prices could remain strong or even rise in the coming years.

In addition, the ongoing digital transformation and the growing popularity of blockchain technology could further enhance the appeal of gold-backed digital assets such as Tether Gold. As more investors seek stability and security during uncertain times, demand for Tether Gold could continue to grow, potentially driving up its value.

image source：tradeview

The current XAUT price is 1:2333 USD, which is linked to gold. It may rise to the resistance line of around $2500 in the short term, but gold will not fluctuate as sharply as cryptocurrencies. It is possible that it may float in the overall range of $1994 to $2500 for a short period of time.

Conclusion

Tether Gold represents the fusion of traditional values and modern technology. By pegging stablecoins to gold, it provides a unique investment opportunity that combines the stability of gold with the efficiency and accessibility of digital currencies. As the global economy goes through uncertain times, Tether Gold stands out at this time as one of the reliable and innovative solutions for preserving and increasing wealth. Of course, Tether is only the first company to take this move, and I believe that different countries and companies will launch similar products in the near future.

Disclaimer:

This article is purely industry information reporting, not investment advice, sales or recruitment.

The crypto market is volatile and unpredictable, and any information released has a strict short-term validity.

Please abide by local laws and regulations, do your own research, and be responsible for your own actions and decisions.

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