Up to 150 Tons of Gold in the Vault!
Investment demand remains a crucial driver in the gold market – and, according to analysts, it is increasingly shifting to digital channels. While gold-backed ETFs (Exchange Traded Funds) have been considered a classic vehicle for investors for years, another mechanism is gaining significant importance: digitally issued, gold-backed tokens. Tether, the world’s leading stablecoin provider, is particularly in focus. Its gold-backed token, Tether Gold (XAU₮), has attracted increased attention since the company’s official gold reserves were published last month.
According to analyst estimates, Tether now holds between 125 and 150 tons of gold. This, according to Jefferies, makes the company one of the largest non-state buyers of physical gold. The trend is remarkable because it shows that gold can establish itself as a reserve and hedging instrument not only in central bank balance sheets or ETF vaults but also in the realm of digital assets.
Tether as a Major Gold Holder: Reserves and Plans for a Higher Gold Ratio
In a recent assessment, Jefferies analysts put the dimension into perspective. According to them, Tether is the largest non-sovereign buyer of physical gold and now ranks among the top 30 largest gold holders worldwide, ahead of several nations! This is particularly relevant for the market because it underscores the role of companies as potential, structural demanders in the gold segment.
It is important to note that Tether’s gold involvement is not limited to the gold-backed XAU₮ token. According to analyst circles, the company also uses gold as a reserve component to back its US dollar-pegged stablecoin. Approximately 7% of total reserves are said to be held in gold. This points to a broader motive: gold is not only considered an “investment product” but also a stability component within a reserve portfolio.
Additional momentum comes from the management’s medium-term plans. Tether CEO Paolo Ardoino stated last month that the company intends to increase the gold proportion in its portfolio to 10% to 15% in the future. Should Tether indeed pursue this target range, it could further increase structural demand for physical gold – at least to the extent that the company’s reserves grow and the planned allocation is implemented.
XAU₮ versus Gold ETFs: Digital Inflows Become Visible
The extent to which XAU₮ is now perceived is also shown by a comparison drawn by analysts at the French bank Société Générale. According to them, XAU₮ holdings – measured by the amount of gold held – would correspond to one of the world’s largest gold ETFs, even though XAU₮ is formally not an ETF but a digital token from an issuer.
Even more striking, according to Société Générale, is the development of inflows: in December, net inflows into XAU₮ were the second highest among all global gold ETFs in their analysis – surpassed only by SPDR Gold Shares (GLD), the world’s largest gold-backed ETF. The fact that a digital gold token competes with established ETF structures in this regard marks a shift in demand patterns from the perspective of many market observers: a portion of investment demand is apparently occurring outside the traditional ETF channel.
Société Générale also emphasizes that these flows sometimes even influenced short-term market behavior. In the last week of January, Tether’s inflows played a dominant role – especially compared to ETF flows. At the same time, the analysts qualify the statement: in total, hedge funds with their positionings continued to have a stronger impact on price formation than Tether or ETFs.
A specific detail from the analysis illustrates the interplay of volatility and demand: after the significant price decline on Friday, January 30, 2026, Tether reportedly added another 11 tons of gold, according to Société Générale – essentially “buying into weakness.” The bank highlights that these purchases surpassed ETF flows but remained behind the influence of hedge funds in the overall picture.
What This Means for the Gold Market
The developments described are particularly interesting because they show the gold market from a new perspective: investment demand no longer arises exclusively through traditional products such as coins, bars, or ETFs, but increasingly also through digital structures. XAU₮ acts as a bridge between the world of tokenized assets and physically backed gold.
For market mechanics, this can have several consequences – without automatically implying a statement about the future price direction. Firstly, it becomes clear that large issuers like Tether not only act as “providers” but can also become relevant players on the demand side through their reserve structure. Secondly, the comparison with ETF flows shows that capital flows can shift more quickly during periods of increased attention – for example, when digital products offer special access to certain investor groups.
At the same time, the analysts’ note remains important: even if Tether and XAU₮ play a noticeable role at times, classic market forces, such as the positioning behavior of large speculative players, continue to dominate in many phases. The gold market is thus not “digitally replaced” but expanded by an additional, dynamic layer.
Ultimately, the analysts’ update primarily documents one thing: Tether, with its gold engagement in the physical market and via Tether Gold (XAU₮), has reached a magnitude that can no longer be ignored in the gold ecosystem – and significantly shapes the debate about investment demand in the digital landscape.
