Stablecoins supporting precious metal parity rise in price as gold price nears record highs
The market capitalization of stablecoins, which are linked to the price of gold, has surpassed $1 billion. The price of tokens is rising along with the value of the underlying asset.
May gold futures rose 1.91% to $2029.4 an ounce on the New York Mercantile Exchange (COMEX) on Tuesday, April 4. This is the highest since March 2022. On Wednesday, April 5, the price of gold continued to rise. In the moment, its price on COMEX increased by 0.12%, to $2032 per ounce.
Gold reached historical highs of $2088 per ounce for COMEX standard futures contract on March 9, 2022.
According to our experts, demand for gold increased amid a weakening dollar in the international market. And the uncertainty of investors in the “bright prospects” of the global economy.
The two largest “gold” stablecoins are PAX Gold (PAXG) from U.S. fintech company Paxos Trust and Tether Gold (XAUT) from Tether. According to CoinGecko, the market capitalization of PAXG rose to $523 million and XAUT to $499 million on April 5. On April 4, those figures were at $509 million and $488 million, respectively.
During the day the value of PAXG grew by 2% to $2035.50. And XAUT rose 2.1%, to $2033.46. Over the past 30 days, Tether Gold has gained 9.2% and PAX Gold has gained 10.4%.
Bitcoin’s correlation with gold hit a multi-year high at the end of March, according to analytics platform Kaiko. It was 50% and surpassed the correlation of BTC with U.S. stocks.
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