As the world faces economic turbulence, particularly driven by US-China tensions and broader market instability, investors are flocking to a time-tested safe haven: gold. However, the rising popularity of tokenized gold—digital versions of gold assets—along with traditional gold exchange-traded funds (ETFs) is outshining Bitcoin in 2025.

Unlike the highly volatile cryptocurrency market, tokenized gold offers a blend of the stability of physical gold and the liquidity of cryptocurrencies. This new form of gold-backed tokens, including popular ones like Paxos Gold (PAXG) and Tether Gold (XAUT), are surging in value as investors seek protection against the ongoing economic uncertainty.

Tokenized Gold Surges Amid Crypto Market Slump

Gold-backed tokens such as PAXG and XAUT have jumped by more than 23% in 2025, marking a notable rise compared to Bitcoin, which has fallen by over 11% this year. In fact, gold-backed digital assets hit new all-time highs earlier this year, with some reaching over $3,300. Meanwhile, Bitcoin’s market performance has been lackluster, contributing to a broader downturn in the cryptocurrency market, which is down by more than 30%, according to the CoinDesk 20 Index.

This stark contrast in performance is causing more investors to shift their focus to tokenized gold, which has the backing of real, physical gold stored in secure vaults. With rising geopolitical tensions, such as ongoing tariff discussions between the U.S. and China, tokenized gold presents a reliable store of value that doesn’t carry the same level of risk as Bitcoin and other volatile cryptocurrencies.

The Appeal of Tokenized Gold: Real Gold with Crypto Flexibility

What makes tokenized gold so attractive? These tokens, such as PAXG and XAUT, offer the stability of physical gold but with the added advantage of being able to trade them instantly on blockchain platforms. This hybrid nature makes them an appealing option for those looking for both security and flexibility in their investments.

Unlike traditional gold, which can take time to buy or sell due to logistical challenges, tokenized gold allows investors to transfer and trade their assets quickly and efficiently. This ease of use, combined with the security of real gold backing, is a powerful combination for those seeking a stable investment in uncertain times.

Gold ETFs See Major Inflows Amid Economic Uncertainty

While tokenized gold is rising, traditional gold ETFs are also experiencing significant growth. In the first quarter of 2025, gold ETFs saw inflows of 226.5 tonnes, the highest in three years, according to the World Gold Council. North America led the charge, accounting for nearly 60% of the demand. This highlights a larger trend among investors seeking safer assets amid economic instability.

The performance of gold ETFs has proven particularly resilient, even during recent global economic volatility, further reinforcing gold’s status as a reliable store of value.

Increased Minting of Gold-Backed Tokens

The growth of tokenized gold is also supported by the increasing minting of new gold-backed tokens. In Q1 2025 alone, over $42.7 million worth of PAXG and XAUT tokens were minted, pushing the total market value of these digital gold-backed assets to nearly $1.4 billion.

The growth in tokenized gold, coupled with significant interest in gold ETFs, suggests that investors are seeking more secure investment options in today’s uncertain market environment. With both the traditional gold market and the cryptocurrency world under pressure, tokenized gold offers a solution that combines the best of both worlds: the stability of gold and the convenience of digital assets.

Conclusion: The Future of Gold in Digital and Traditional Forms

As the global economy faces increasing uncertainty, it’s clear that tokenized gold and gold ETFs are positioned for continued growth in 2025. Whether through blockchain-based tokens or traditional gold-backed ETFs, investors are increasingly turning to gold as a safe haven. The success of these digital gold assets, coupled with the resilience of traditional gold, suggests that when it comes to safe investments in volatile times, gold—whether physical or digital—is making a powerful comeback.