Gold Prices Rally as ETF Inflows Surge, Driving Increased Interest in Gold-Backed Cryptos
Gold continues its impressive run in 2025, climbing 11% year-to-date and 43% over the past year, as investors turn to traditional safe-haven assets amid economic uncertainty and market volatility.
While spot Bitcoin ETFs recorded their largest-ever daily outflow of nearly $1 billion, gold ETFs are witnessing substantial inflows, reflecting a shift in investor sentiment toward more stable assets.
Gold ETFs See Biggest Inflows in Nearly Three Years
According to data from the World Gold Council, physically backed gold ETFs recorded their largest weekly inflow since March 2022, adding 52.4 tons ($4.9 billion). Most of this demand originated from North American investors, signaling growing institutional confidence in gold.
Gold ETF holdings now stand at 3,326 tons, valued at an estimated $314 billion.
Currently trading at $2,910 per ounce, gold’s rise is being attributed to rising geopolitical tensions and economic uncertainty, particularly concerning potential trade tariffs under a second Trump presidency.
Gold-Pegged Cryptocurrencies Outperform the Broader Market
Gold-backed digital assets, including Paxos Gold (PAXG) and Tether Gold (XAUT), have outperformed the broader crypto market as demand for gold rises. While the CoinDesk 20 Index shows the overall crypto market up 26% year-over-year, gold-pegged tokens have seen increased investor interest.
Data from RWA.xyz indicates that over $25 million worth of commodity-backed tokens were minted this month—the highest volume since December 2022—while $12 million worth were burned, signaling a rise in activity.
Gold Supply Constraints Could Drive Prices Even Higher
Despite the growing demand, gold supply remains constrained. Data from the World Gold Council shows that gold mining production declined by two tons in Q4 2024, while hedging and recycling activity increased. Overall, total gold supply grew just 1% year-over-year, adding further upward pressure on prices.
With limited supply, increasing institutional demand, and macroeconomic uncertainty, gold’s strong momentum is likely to continue—paving the way for further gains in both physical gold and gold-backed cryptocurrencies.
