Gold reached an all-time peak (ATH) in 2018, surpassing $2K for each ounce. However, top crypto assets tokenized with gold continue to experience significant demand and premiums. For instance, Paxos Trust Company’s PAXG market cap jumped more than 43% in 31 days from $424 million to today’s $611 million.
PAXG and XAUT Market Caps Swell, Both Gold Tokens See Premiums Over Gold’s Spot Market Value
One troy ounce (.999) of fine gold was $2,069 for a unit on March 8, 2022. An equivalent of 480 grains, or approximately 31.10 grams is a troy ounce which is almost pure. Tokenized gold crypto assets have seen a significant increase in demand as the value of physical bullion has increased. In recent years, tokenized assets in gold crypto have enjoyed a premium because tokens which represent one troy-ounce of.999 gold have experienced higher spot market prices.
At the time of writing, Tether’s XAUT has a 2.18% premium compared to the current spot value of gold. There is a premium of 0.26% for Pax gold (PAXG), and tokenized asset markets valuations have increased over the past 30 day. Data indicates that Paxos Trust Company’s PAXG had a market valuation of $424 million on February 19, 2022. A month later, metrics show PAXG’s market cap grew by over 43% to $611 million. XAUT’s market cap grew from $430 million 31 days ago to today’s $486 million, jumping more than 13%.
Leveraging the average price per ounce of gold over the last 30 days ($1,875) and dividing $611 million by that number would mean Paxos Trust Company’s vaults hold about 325,333 ounces of fine gold. Using the same average and dividing it by PAXG’s market cap increase shows Paxos Trust Company added around 99,200 ounces to its vaults since February 19. The same math shows Tether added around 29,866 ounces of gold to the company’s stash. Between both projects, that’s around 129,066 troy ounces of .999 fine gold backing the tokenized gold crypto assets.
However, the 30-day average price per troy ounce is not consistent with the number of crypto-assets tokenized in gold from each project. At the time of writing, PAXG’s circulating supply is 317,255 tokens and XAUT’s circulating supply is 246,524 tokens. Every token is equal to 1 troy ounce of fine gold. While coingecko.com’s data shows a circulating supply of 246,524 XAUT tokens, Tether’s transparency page indicates there are 226,289 XAUT available.
The market value of the Perth mint gold token PMGT is much lower than that of Tether and Paxos’ gold tokens. At the time of writing, PMGT’s market capitalization is around $2.1 million and PMGT trading volume has been around $13,650 in swaps during the last 24 hours. PAXG’s 24-hour trade volume today is $14.4 million while XAUT’s daily volume is $1.5 million.
Let us know your thoughts on the tokenized tokens of gold that saw significant premiums and growth over the last month. We’d love to hear your views on the subject.
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