Surging ETF Inflows Boost Gold-Backed Cryptocurrencies to New Highs

Gold Prices Surge as ETF Inflows Hit Multi-Year High, Boosting Gold-Pegged Cryptos

Gold has continued its impressive rally in 2025, rising nearly 11% year-to-date and 43% over the past year, as investors seek safe-haven assets amid macroeconomic and geopolitical uncertainty.

While spot Bitcoin ETFs saw record daily outflows of nearly $1 billion, gold ETFs have been drawing strong inflows, reinforcing gold’s status as a preferred hedge against market volatility.

Gold ETFs See Largest Weekly Inflows Since 2022

According to the World Gold Council, physically backed gold ETFs recorded their biggest weekly inflow since March 2022, adding 52.4 tons ($4.9 billion) in assets. The bulk of these inflows came from North American investors, highlighting institutional confidence in gold.

Total gold ETF holdings now stand at 3,326 tons, with an estimated market value of $314 billion.

Gold is currently trading at $2,910 per ounce, with analysts attributing the rally to escalating geopolitical tensions and uncertainty over potential U.S. trade policies, particularly regarding possible tariff implementations under a second Trump administration.

Gold-Pegged Cryptos Benefit from Institutional Demand

Gold-backed cryptocurrencies such as Paxos Gold (PAXG) and Tether Gold (XAUT), designed to mirror the metal’s price movements, have been outperforming the broader crypto market. While the CoinDesk 20 Index reflects a 26% increase year-over-year, demand for gold-backed digital assets has been rising at an even faster pace.

Blockchain data from RWA.xyz shows that over $25 million worth of gold-backed tokens were minted this month, marking the highest issuance since December 2022, while $12 million in tokens were burned.

Limited Supply Adds to Bullish Outlook

Despite rising demand, gold supply remains tight. Data from the World Gold Council indicates that gold mining production declined by two tons in Q4 2024, while hedging and recycling activity increased. In total, global gold supply rose by just 1% year-over-year, signaling potential supply-side constraints that could further support price gains.

With strong institutional demand, a limited supply environment, and heightened geopolitical uncertainty, gold’s rally appears set to continue—benefiting both the metal and gold-backed digital assets in the process.