Gold ETFs Outperform Crypto ETFs in 2025 : Investors Shift to PAXG, XAUT

The post Gold ETFs Outperform Crypto ETFs in 2025 : Investors Shift to PAXG, XAUT appeared first on Coinpedia Fintech News

As markets get shaky and investors hunt for safer ground, gold is once again proving to be a favorite. But this time, it’s not just the traditional yellow metal that’s winning attention, its digital versions are catching fire too. Recently, Gold-backed cryptocurrencies like Paxos Gold (PAXG) and Tether Gold (XAUT) have been on a strong rally this year, climbing over 23% year-to-date. These digital tokens are pegged to physical gold and move in sync with its price. 

In early 2025, both tokens touched new all-time highs above $3,300 before settling slightly lower. In comparison, Bitcoin has dropped over 11% this year, and the overall crypto market is down more than 30%, according to the CoinDesk 20 index. That’s why many investors are now turning to tokenized gold to protect their money.

While Trump’s tariff war crashed the entire crypto market, Gold ETFs stayed strong and proved it’s still a valuable investment option. 

Why Tokenized Gold is Getting Attention

The two top gainers PAXG and XAUT has become popular because they offer the best of both worlds, real-world asset backing and the flexibility of crypto. These tokens are backed by actual gold stored in vaults, but they can be traded easily on the blockchain. 

This makes them more liquid than traditional gold while still offering the same safe-haven qualities. With growing uncertainty in global markets, especially due to rising tensions between the U.S. and China, more investors are looking for stability, and gold is a natural choice.

Big Money is Also Moving into Gold ETFs

The rising interest in gold isn’t limited to the crypto space. Traditional investors are pouring money into gold ETFs as well. In the first quarter of 2025, inflows into gold ETFs reached 226.5 tonnes, the highest level in three years, according to the World Gold Council. North America led the trend, accounting for nearly 60% of that demand. This shows a broader shift toward gold as a safer investment option.

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Token Minting Adds to the Momentum

Meanwhile, backing the rally in tokenized gold is a wave of new token minting. In Q1 alone, over $42.7 million worth of PAXG and XAUT were minted, according to RWA.xyz. This helped raise the total market cap of gold-backed tokens to nearly $1.4 billion. As traditional and crypto markets both face pressure, it’s clear that tokenized gold is becoming a go-to asset for investors who want security with digital convenience.