Gold has entered a new phase of price discovery. By December 2025, prices had pushed beyond $4,500 per ounce, marking fresh all-time highs and extending a rally driven by geopolitical uncertainty, sustained central-bank demand, and expectations of easier global monetary policy. With prices holding well above previous resistance levels, gold’s role as a long-term store of value has once again moved to the center of investor attention.
Tether Gold Price Chart | Source: BingX
This strength has also carried into the on-chain gold market. Tether Gold (XAUt) is a tokenized gold asset that represents ownership of physical gold stored in professional vaults, allowing investors to gain gold exposure with 24/7 liquidity and blockchain-based settlement. As demand for digital gold grows, the total market capitalization of tokenized gold assets has expanded to around $4.5 billion. Within this category, XAUT remains the leading product, accounting for roughly half of the sector’s total market value while closely tracking spot gold prices.
In this guide, we explain how Tether Gold (XAUT) works, why interest in tokenized gold is growing, and how XAUT compares with holding physical gold. We examine the key differences across fees, custody, redemption, liquidity, and risk, helping you decide which form of gold exposure best fits your strategy.
What Is Tether Gold (XAUt) the Tokenized Gold Token?
Tether Gold (XAUt) is a digital token that represents ownership of physical gold. Each XAUt corresponds to one fine troy ounce on a London Bullion Market Association (LBMA) Good Delivery bar held in Swiss vaults. The token is issued by TG Commodities, S.A. de C.V. and launched in 2020 to combine the familiarity of gold with the utility of blockchain.
Unlike a typical “gold price tracker,” XAUt confers undivided ownership rights to specific bars. Holders can look up the serial number, weight and purity linked to their on-chain address. Because it is a token on public networks, you can trade and transfer exposure to gold 24/7, even when traditional bullion venues are closed. XAUt can be split into very small fractions, down to 0.000001 troy ounce, which makes gold accessible in sizes that are impractical with bars and coins.
There are two ways to acquire it. You can buy a minimum of 50 XAUt directly from the Tether Gold platform after identity verification, or you can purchase smaller amounts on exchanges that list XAUt trading pairs. There are no custody fees charged by the issuer; purchases and redemptions incur a one-time 25 basis point fee, and normal network gas fees apply for on-chain transfers. U.S. persons are not permitted to purchase or redeem XAUt via the issuer and should review the terms carefully.
How Does Tether Gold Work?
1. Digitization
Tether Gold (XAUT) is issued by TG Commodities and backed by LBMA Good Delivery gold bars. Each XAUT token represents one fine troy ounce of physical gold held on an allocated bar. Ownership is recorded on-chain and mirrored in the issuer’s vault records. Token holders can verify their specific bar details, including serial number, weight, and purity, using Tether Gold’s official lookup tools.
2. Transferability
XAUT is an ERC-20 token on Ethereum blockchain, which means it can be held in any compatible wallet and transferred like other crypto assets. Tokens can be moved in whole units or fractions, allowing for flexible position sizing. Exchanges that support XAUT operate 24/7, enabling holders to adjust gold exposure at any time and from anywhere.
3. Redemption
To redeem physical gold, holders must accumulate enough XAUT to correspond to a full gold bar. LBMA Good Delivery bars typically contain up to around 430 fine troy ounces, so redemption generally requires a minimum of 430 XAUT. Physical delivery is available to Swiss addresses for an additional fee. As an alternative, TG Commodities can arrange for the bar to be sold on the Swiss market, with USD proceeds wired to the holder after applicable fees.
4. On-ramp and verification
Users who purchase XAUT directly from the issuer must complete a KYC verification process.
• Individual buyers: Applicants must submit two government-issued photo IDs, proof of address dated within the past 90 days, a selfie holding the ID with the current date visible, and a recent bank statement.
• Corporate applicants: Companies are required to provide incorporation documents, a list of officers and shareholders, proof of address, recent bank statements, and a clear description of the company’s ownership and control structure.
A non-refundable verification deposit of 150 USDT is required. Once verification and payment are completed, purchases are typically processed within a few business days.
Or just buy on BingX with faster KYC and 24/7 trading to get XAUt in minutes.
XAUt vs. Gold: What Are the Key Differences?
Both give you exposure to gold. The way you hold and use that exposure is very different.
• Ownership structure: With XAUt you hold a digital claim on allocated bars, visible on-chain and verifiable by serial number. With coins and bars in your possession, you control the metal directly without reliance on an issuer, but you must arrange storage, insurance and transport.
• Access and trading hours: XAUt trades on platforms that run 24/7. Physical gold liquidity depends on dealers, vault opening hours, and settlement arrangements.
• Divisibility: XAUt can be sliced to six decimal places. Splitting a physical bar is impractical and costly.
• Storage and fees: XAUt has no recurring custodian fee from the issuer, though on-chain gas fees apply, and purchases or redemptions via the issuer carry a one-time 25 bps fee. Physical gold typically involves premiums on purchase, plus ongoing storage and insurance if vaulted.
• Redemption logistics: XAUt redemption requires whole-bar quantities with delivery in Switzerland or a sell-for-cash option. Physical gold in hand is already “redeemed,” though selling back to dealers may involve spreads and settlement time.
| Feature | Tether Gold (XAUT) | Physical Gold |
| Backing | 1:1 claim on allocated LBMA bars | Direct ownership of bars or coins |
| Format | ERC-20 token on Ethereum | Physical metal |
| Minimums | None on exchanges; issuer minimum applies | Varies by dealer and product |
| Trading Hours | 24/7 on crypto platforms | Limited market and dealer hours |
| Divisibility | Fractional down to micro-ounces | Fixed bar or coin sizes |
| Ongoing Costs | Network gas and trading fees | Storage and insurance costs |
| Issuer / Dealer Fees | Issuer fees on mint and redeem | Dealer spreads and selling fees |
| Redemption | Whole-bar redemption or USD sale | Sell or transfer via dealers |
| Verification | On-chain balance and bar lookup | Hallmarks and dealer checks |
| KYC | Required via issuer | Varies by jurisdiction |
Should You Choose Physical Gold or Tether Gold?
Choose XAUt if you value convenience and speed. It fits naturally into a crypto trading stack. You can size positions precisely, move them between wallets, or post them on venues that support XAUt trading pairs. If you are building a diversified digital asset portfolio and want a 24/7 “safe-haven” sleeve without arranging vaulting, XAUt is designed for that.
Choose physical gold if direct, tangible control matters most to you. For long-term holders who want outside-the-system metal in a safe or segregated vault, coins and bars still set the standard. Physical owners accept the logistics of storage and resale in exchange for eliminating issuer and smart-contract exposure.
There is also a blended path. Some investors keep a core stack of physical bars for deep security and hold a flexible XAUt balance for trading, rebalancing, and cross-platform mobility.
How to Trade Tether Gold (XAUT) on BingX
Whether you are building a long-term XAUT position, trading short-term volatility, or reacting to major news events, BingX provides flexible ways to trade the token. With BingX AI integrated directly into the trading interface, you can access real-time insights to support smarter trading decisions across both spot and futures markets.
XAUT/USDT trading pair on the spot market powered by Bingx AI
2. Plan the trade: On the chart, click the AI icon to view support and resistance, breakout zones, and suggested entry areas. Decide your entry, stop loss, and take profit.
3. Place and manage the order: Choose Limit or Market, set size, and confirm. Add your stop loss and take profit immediately. If needed, deposit XAUT or USDT and verify the correct network before trading.
Always conduct your own research (DYOR). Diversify your portfolio and never invest more than you can afford to lose.
How to Trade XAUT Perpetual Futures
XAUTUSDT perpetual contract on BingX futures powered by AI Bingo
Futures, especially perpetual futures, let you trade XAUT price movements with leverage; you don’t necessarily need to hold the underlying XAUT. You can go long (betting price will rise) or short (betting price will fall). BingX offers a XAUT-USDT perpetual contract.
1. Switch to the futures/perpetual trading section in BingX: Navigate to Futures and locate XAUT-USDT perpetual contract.
2. Review contract specifications: Things to check include:
• Leverage limits, e.g. 5×, 10×, etc.
• Maintenance margin and initial margin rates
• Funding rate (periodic payments between longs and shorts)
• Mark price, index price, and settlement rules
3. Choose direction (Long or Short) and leverage: Based on your market view, open a long or short position. Leverage amplifies both gains and losses, so use with caution.
4. Set entry, exit & risk controls
• Use stop-loss orders
• Use take-profit orders
• Monitor your margin level
• Be mindful of liquidation risk (if losses push margin below maintenance).
5. Monitor funding and rollovers: As a perpetual contract, there will be a funding rate mechanism (to keep contract price close to the spot). Depending on whether you're long or short, you may either pay or receive funding periodically.
6. Close the position: When your target is hit (or your stop), close the position, and your P&L (profit/loss) will be settled in USDT.
Is Buying XAUT Safe?
Tether Gold (XAUT) provides on-chain exposure to physical gold through a layered risk model. Each XAUT token is backed 1:1 by LBMA Good Delivery gold bars held in professional vaults, with ownership recorded on-chain and mirrored in vault records. Holders can verify bar details such as serial number and purity using official lookup tools, which helps reduce rehypothecation risk compared with unallocated gold products.
However, XAUT is not risk-free. Token holders rely on TG Commodities and the broader Tether ecosystem to maintain reserves, custody, and redemption processes, introducing issuer and counterparty risk. As an ERC-20 token on Ethereum, XAUT also carries standard blockchain risks, including wallet security and network fees. XAUT is generally viewed as a lower-risk option within the crypto space for gold price exposure, but it is not a substitute for holding physical gold directly.
Risk and Considerations
XAUt is issued by TG Commodities, so redemption and access depend on the issuer and its terms, including geo restrictions. As an ERC-20 token it carries typical crypto risks; bad approvals, phishing, or lost keys can mean loss, so use strong wallet security.
Physical delivery requires a full bar, often around 430 fine troy ounces, so many treat XAUt as digital exposure unless they plan for that size. Issuer buys and redemptions cost 25 bps, on-chain transfers incur gas, and exchange trades add maker and taker fees, while physical gold adds premiums, storage, and insurance.
Issuer processing takes several business days after KYC and payment, whereas exchanges that list XAUt can provide faster secondary access. U.S. persons cannot purchase or redeem through the issuer, and liquidity ultimately depends on the venue and pair depth.
Conclusion
Gold has earned its place as a portfolio anchor across generations. Tether Gold (XAUt) takes that anchor and makes it easier to hold and move in a digital environment. You get 24/7 access, precise sizing and on-chain transparency tied to real, allocated bars. If you want direct, tangible control and are comfortable with vaulting logistics, physical bars and coins remain the classic route.
For many, the practical answer is not either-or. Keep a physical core for long-term wealth preservation and add an XAUt layer for flexibility, instant transfers and round-the-clock trading. Whatever mix you choose, align it with your goals, your tolerance for operational complexity, and how you prefer to manage custody.
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FAQs on Tether Gold (XAUT)
1. Is XAUT backed 1:1 by gold?
Yes. Tether Gold (XAUT) is fully backed 1:1 by physical gold. Each token represents one fine troy ounce of LBMA Good Delivery gold held in allocated vaults.
2. Where is the gold backing XAUT stored?
The gold backing XAUT is stored in professional vaults, primarily in Switzerland, under custody arrangements managed by the issuer.
3. Can XAUT be redeemed for physical gold?
Yes. XAUT can be redeemed for physical gold, but redemption typically requires holding enough tokens to correspond to a full LBMA Good Delivery gold bar, usually around 430 troy ounces. Physical delivery is available to Swiss addresses for a fee, or the gold can be sold on the Swiss market for cash settlement.
4. Is XAUT safe to hold long term?
XAUT is generally considered lower risk than most cryptocurrencies because it is backed by physical gold. However, it still carries issuer, custody, and blockchain-related risks.
5. Does XAUT pay interest or generate yield?
No. XAUT does not pay interest, dividends, or yield. Its value tracks the price of gold only.
6. Is XAUT regulated or audited?
XAUT is issued under a real-world asset framework with physical gold backing, but it is not regulated like a gold ETF. Regulatory and audit practices may vary by jurisdiction.