Large on-chain gold owners raised questions as to whether they anticipated a short-term price ceiling by selling about $40 million in tokenized gold. These outflows occurred when physical gold prices exceeded $5,000 per ounce. Analysts differ on whether these movements are a bear-directed signal or part of a broader structural change in demand.
According to the data, two wallets at 0x8C08 and 0xdfcA sold 5,250 XAUT for $5,125 and 560 PAXG for $5,173, respectively, making a total of approximately $29.8 million in trades and an estimated profit of $5.32 million. Hours later, another wallet with the address 0x8844 sold 1,934 XAUT for $5,037, bringing the total sales volume to about $40 million. All these transactions coincided with the same period when physical gold prices exceeded $5,000 per ounce.
While some analysts do not see these exits as a bear-directed signal, some point out that there are structural factors underlying geopolitical tension, disruptions in energy supply and central banks' gold accumulation.
According to market data, the market value of the tokenized gold market now exceeds $6 billion. Physical gold rose to $5,394 per ounce with the increase in demand for a safe haven in global markets following the US and Israel's attacks on Iran. Analytics company Lookonchain found that a sedent wallet transferred 1 million USDC to PAX Gold (PAXG) and Tether Gold (XAUT) assets.
Why Did This Development Happen?
The on-chain mobility of institutional investors and whales has led to an increase in tokenized gold volumes. Large transfers show an increase in demand for on-chain safe haven assets. While the market value of the tokenized gold sector exceeded 6 billion dollars, the daily transaction volumes of PAXG and XAUT exceeded $1 billion.
During periods of rising geopolitical tension, capital is turning to tokenized gold assets such as XAUT and PAXG as an alternative safe haven to crypto. This situation highlights its increasing role as a protection tool of tokenized gold in market uncertainty.
What Was The Market Reaction?
Structural concerns about dominant debt sustainability, inflation and currency depreciation are effective in gold prices rising above $5,300 per ounce. According to research, investment institutions are re-evaluating traditional 60/40 share-bond portfolio strategies and acknowledge that these strategies are inadequate during periods of synchronized monetary expansion.
Central banks create structural demand for precious metals by changing their monetary policy approaches. The US Federal Reserve's (Fed) expectation of a total interest rate cut of 150 basis points by 2026 reduces the opportunity cost of holding gold without return.
Developing countries such as China and India are also accumulating a significant amount of gold in order to diversify dollar-based assets in the period of 2024-2025. This trend increases the attractiveness of gold as a global store of value in the environment of economic uncertainty.
What are analysts watching next?
The Central Bank of Kazakhstan is indirectly allocating 350 million dollars from gold and foreign exchange reserves into crypto assets. The focus is on managing national reserves and testing crypto integration through infrastructure and funds instead of direct crypto purchases.
Vice President Aliya Moldabekova stated that this approach avoids large-scale direct purchases in cryptocurrencies such as Bitcoin or Ethereum. The current portfolio is a continuation of previous initiatives where the government researched crypto reserves and used confiscated assets and public mining revenues.
The Indian government, on the other hand, expects the recent increase in global oil prices to have a limited impact on inflation thanks to the current low inflation level and the central bank's monetary policy buffer. Retail inflation is close to the lower limit of the Bank of India's target range of 2–6% with 2.75%.
While it is stated that a 10% increase in the price of crude oil could increase inflation by about 30 basis points, the government emphasizes that the medium-term effect depends on many factors such as exchange rates, the global supply-demand balance and the monetary policy transfer mechanism. As a result of the supply cut by manufacturers in the Middle East due to supply chain disruptions in the Strait of Hormuz, the Indian crude oil basket rose from $69.01 to $80.16 per barrel at the beginning of March.
