Tether Gold (XAUT), a tokenized gold asset, broke its previous daily permanent trading volume record on Binance on March 23rd.
XAUT traded at around $4,552 on March 25, and Perpetual Trading, a crypto derivatives product that allows traders to speculate on the price of gold without owning the actual asset, hit an all-time high on the largest crypto exchange by trading volume. On Monday, Binance’s XAUT perpetual trading volume surged to $6.4 billion, making it the fifth most traded perpetual pair on the exchange, according to data. cryptoquant.
Earlier this month, XAUT’s perpetual trading volume on the exchange hovered around $2 billion, representing a 220% increase year-to-date. Historically, large increases in XAUT’s PERP volume have coincided with potential price spikes and can signal a market rebound.
Surging demand for tokenized gold coincides with bearish sentiment
The notable spike in tokenized gold perpetual trading on Binance is consistent with a cautious price outlook. Traders on Binance are scrambling to gain exposure to gold and other precious metals, which have been in a generally bullish market over the past year.
However, the price of XAUT is tracking the price of spot gold, suggesting a possible bullish depletion ahead of a possible market reversal. Geopolitical tensions in the Middle East have historically supported the price of safe-haven gold, but the current macro environment, with global central banks indicating no short-term interest rate cuts to counter inflation due to rising energy prices, presents a headwind that could weigh on gold’s short-term trajectory.
Over the past 30 days, the price of XAUT has decreased by 12.33% and reached $4,552 at the time of writing. Over the past seven days, XAUT has fallen another 6.7%, reducing its market cap to around $2.5 billion. CoinMarketCap data.
