Stablecoins buying Gold
Stablecoins are supposed to be pegged to the US Dollar ($), but over the weekend I discovered as many of you did that Stablecoins are buying physical Gold to hold in their treasury! Gold is real money and thus available as collateral in financial markets.
So just how much gold are we talking here?
Not a lot of information has been released yet, I expect more as Financial Regulations push for disclosure of this type of information, maybe by year end?
- Tether has stated they own they own Tons of Gold in their XAUT gold-backed token fund
- PAXG (Pax Gold fund) claims to own 1 Troy ounce of Gold per token. 1:1 ratio, however I was not able to find any details in/around how many tokens have been issued. So unable to try and understand what the total quantity of gold owned would be. Payouts are redemption available for LBMA-accredited Good Delivery gold
What are the ramifications of other companies adopting gold as well?
how would these stablecoins perform vs those not adopting gold for treasury assets?
last week there was a notable news story that Central Banks globally now own more gold than US Treasuries. Central Bank gold purchases are up 50% over the past 3-years! 50% growth might not sound like a lot of gold but it amounts to 1,100 Tons of gold. Yeah that a lot-o-gold. Feels likes the common class missed the memo to get into gold. I would expect more upward price movements with increased demand from central banks and now stablecoins! What would happen if large hedge funds and 401(k)s started investing in Gold? Sure gold is in a tear, but isn’t it a relic? Sure gold just added $10Trillion of market cap in the past 12-months. But isn’t it just a relic?
Summary
Watch what they do, not what they say! They love the sleight of hand to keep the phlebs down! Protect yourself and get some physical gold. This is NOT financial advice, so don't construe it as such! DYOR!
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