Tether backs XAUT tokens with physical Gold

Tether has launched Scudo, a new unit designed to facilitate the use of its gold-backed digital tokens in everyday transactions. Scudo is expected to simplify how people price, send, and receive Gold in digital form, essentially mirroring the way digital currencies are used to complete daily cash payments, the company says.

Best known for USDT, a token pegged to the U.S. dollar, Tether is now turning its focus to Gold. The company notes that Gold remains a trusted asset, particularly in digital payments, because it holds value over time. Scudo is designed to bring that reliability to modern users.

Under Tether’s strategy, one Scudo is equal to one-thousandth of a troy ounce of Gold. That is also the value of a small portion of Tether’s gold-backed token, XAUT. One Scudo was trading for around $4.48 on Tuesday, and one satoshi (the smallest unit of Bitcoin) was worth about $0.001.

Tether says this tiny little piece of Gold could help people more easily purchase using Gold without having to handle a large or expensive amount of it.

The company also highlighted Gold’s growing global appeal amid inflation, uncertain interest rates, and record purchases by central banks, noting that many view it as a safe store of value during times of financial uncertainty.

Tether backs XAUT tokens with physical Gold

Tether already offers a gold-backed digital token called XAUT. Each XAUT token is backed by real gold bars stored in secure vaults. According to Tether’s website, the company holds 1,329 gold bars, equal to 16.2 metric tons of Gold, to support XAUT.

As of Tuesday, XAUT had a market value of $2.3 billion, according to CoinGecko. This value has almost quadrupled in the past year, showing that more people are using or investing in it.

Tether states that anyone who owns XAUT tokens can redeem them for physical Gold. The company can even deliver gold bars to any physical address in Switzerland, according to its website.

Last year, Tether released its first attestation report for XAUT. BDO Italia, an accounting firm, prepared the report. However, the report did not fully comply with international financial reporting standards, as it did not include some important financial details. Critics have been asking Tether to allow full independent audits for many years.

Despite this criticism, Tether CEO Paolo Ardoino stated in April that XAUT was gaining strong interest in emerging markets, where individuals are seeking safer ways to protect their assets.

Gold-backed tokens gain ground as competition grows

The name Scudo has historical roots. It was used in Italy more than 400 years ago to describe different kinds of gold and silver coins. The word comes from a Latin term meaning “shield.” This is interesting because Tether’s logo also looks like a shield.

Tether’s CEO, Paolo Ardoino, and CFO, Giancarlo Devasini, were both born in Italy. Last year, Tether bought a minority stake in Juventus, one of Italy’s most famous football clubs. A recent attempt by Tether to buy a majority stake in the club was rejected.

Tether also offers another product called Alloy, which it describes as a “Tethered Asset.” By using XAUT tokens as collateral, customers can receive aUSDT, a digital token that functions similarly to USDT and is pegged to the U.S. dollar.

Tether is not the only company offering gold-backed digital tokens. Before XAUT was launched, another company called Paxos introduced PAXG, the first digital gold token that could be redeemed for real Gold. On Tuesday, PAXG had a market value of $1.7 billion, after tripling in size over the past year.

Paxos is also the issuer of PayPal’s PYUSD stablecoin. In a recent announcement, Paxos officials declared that PAXG would now be exclusively a gold token controlled by federal bank regulators.

Nevertheless, even as XAUT is evaluated at $2.3 billion, overall, Tether claims to have much more Gold. By the close of Q3 2025, the company reported that it held 116 metric tonnes of Gold, worth almost USD 17 billion according to today’s prices.

With Scudo, Tether aims to create a new and user-friendly gold standard for the digital age—in other words, to recreate what Gold once was.

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