Tokenized Gold Surges As Bitcoin Lags: Flight to Safety or Short-Term Rotation?

Falling numbers today could be tomorrow’s opportunity: investors are increasingly parking capital in gold — including tokenized versions on blockchain — as Bitcoin lags behind. Why tokenized gold is rising Data from Token Terminal shows tokenized gold supply has climbed alongside recent gold price gains. Paxos’s PAXG now sits at roughly $1.5 billion outstanding, a clear increase from most of 2023 and early 2024. Rather than only buying ETFs or physical bars, investors are turning to blockchain-based gold for reasons that matter in turbulent markets: - Easier access (fractional ownership) - Faster settlement and near-instant transfers - 24/7 trading across global venues These features make tokenized gold an attractive “safety” play when markets get jittery. Bitcoin vs. gold: rotation or retreat? While gold rallies, Bitcoin (BTC) has been moving much more slowly. The Bitcoin-to-gold ratio has dropped to levels that historically have coincided with market lows — periods that, in previous cycles, preceded strong BTC rebounds. That dynamic suggests Bitcoin’s recent weakness may be relative (gold outperforming) rather than an absolute collapse in crypto demand. Notably, this shift has occurred even as some measures of gold demand cooled, underscoring the complexity of the move. Analyst and community takes Crypto analyst Michael van de Poppe framed the backdrop as a valuation tug-of-war: “One of them is getting overvalued. One of them is getting undervalued. In my thesis, Gold is getting overvalued, while Bitcoin is getting undervalued.” (Source: X) On the other side, long-time Bitcoin advocate Matthew Kratter emphasizes structural differences: gold’s supply grows only about 1–2% annually, it’s costly to ship and insure, and it’s an inefficient tool for settling trade imbalances — factors that limit gold’s role in a modern, digital financial system. What this means for investors For now, gold — and especially tokenized gold — appears to be winning the safety trade, drawing selective capital away from crypto. But proponents of Bitcoin argue the narrative may simply be unfolding on different timelines: temporary rotation into safe havens versus a lasting redefinition of what “safe” looks like in a digital economy. Whether this is a short-term flight to safety or a structural shift depends on how investors increasingly define and demand safety in a digital financial system. Disclaimer: AMBCrypto’s content is informational and not investment advice. Trading or investing in cryptocurrencies carries high risk; readers should do their own research before making decisions. © 2025 AMBCrypto Read more AI-generated news on: undefined/news