Tether Gold (XAUT) has secured new institutional infrastructure that could expand its use as an alternative to gold exchange-traded funds. In November, Anchorage Digital announced custody, principal-desk trading, and collateral support for the gold-backed token, moves designed to help eligible institutional clients sell or borrow against their holdings.
Tether CEO Paolo Ardoino stated that XAUT is on track to become "the first true competitor to the gold ETF market." KPMG U.S. audited the financial statements of TG Commodities S.A. de C.V., the issuer entity, for the year ended December 31, 2025, issuing an unqualified opinion.
Institutional Access Only
Access to Tether Gold remains restricted to eligible institutional clients and a limited number of high-net-worth participants. Anchorage holds XAUT at its U.S. bank or Singapore operations. Notably, U.S. persons cannot directly purchase or redeem XAUT with TG Commodities, though U.S. entities classified as eligible contract participants may be accepted at Tether Gold's sole discretion.
Custodied tokens at Anchorage do not carry FDIC or SIPC protection, and the custody arrangement does not guarantee liquidity or insured gold deposits.
How Liquidity Works
Token holders seeking to convert XAUT to cash face multiple requirements. Redemption for physical delivery occurs in Switzerland and requires whole-bar transactions. Alternatively, customers can request Tether Gold attempt a sale to a gold dealer or broker, but this produces fiat proceeds only if a buyer is found and is subject to fees. Tether Gold has no obligation to repurchase tokens or bullion.
Anchorage offers USD or USDT borrowing against custodied XAUT through arrangements with other clients. This preserves gold exposure while creating debt but does not establish bank-funded lending arrangements.
Comparison to Traditional ETFs
Traditional gold ETFs operate similarly in some respects. The iShares Gold Trust (IAU), traded on NYSE Arca, also relies on intermediaries. Retail shareholders sell shares through brokers to market buyers rather than redeeming directly from the trust. Creation and redemption of baskets are reserved for authorized participants. Borrowing against IAU shares is available within brokerage arrangements subject to approval, following standard margin requirements.
As of November 13, iShares reported nearly 9 million IAU shares traded and a 0.01% median bid-ask spread. Anchorage describes XAUT as its most active tokenized-gold product but has not disclosed comparable trading depth, quoted spreads, or lending volumes.
The practical test of XUAT's competitiveness ultimately depends on whether eligible clients can find counterparties willing to transact at the size and price they need. Custody and collateral support create potential routes, but their availability at scale remains to be demonstrated.
