Commodity-Backed Cryptocurrencies Hit 5-Year Minting Record Over Gold Trade Turmoil
Main Idea
Commodity-backed cryptocurrencies, particularly gold-backed tokens, reached a 5-year minting record due to U.S. tariffs on Swiss gold exports, with minting volumes doubling previous records.
Key Points
1. Gold-backed cryptocurrencies, including Tether Gold and Paxos Gold (PAXG), briefly topped $3,390 before receding.
2. Minting volumes reached $439 million over the week, more than doubling the previous $195 million record seen in 2021.
3. The U.S.’s 39% tariffs on Switzerland’s gold exports triggered a political backlash, as gold makes up over a quarter of Switzerland’s exports.
4. Commodity-backed tokens allow instant on-chain transactions without crossing borders, backed by physical reserves held in vaults.
Description
Commodity-backed cryptocurrencies, which are dominated by gold-backed tokens, have seen a historic surge in issuance this week, with minting volumes hitting their highest point in at least five years. The leap comes after gold futures traded above a $3,500 all-time high this week, after the Swiss Precious Metals Association warned that the U.S.’s 39% tariffs on Switzerland could have “negative impact" on the international flow of physical gold. Both gold spot and futures fell after the initial s...
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