TL;DR

Record Rally: PAXG hit $4,407.52, surpassing spot gold’s $4,364.82, with Binance spikes above $4,790 and volumes topping $854M.

Premium Trading: The token traded at a premium to spot, briefly exceeding $5,000, reflecting demand but also risks of sharp corrections.

Market Shift: Investors rotated from BTC into gold-backed tokens, pushing total locked value to $3.39B, with PAXG challenging XAUT’s dominance.

Pax Gold (PAXG), the Ethereum-based token backed by physical gold, has surged to unprecedented levels, capturing market attention with record-breaking trading volumes and a premium over spot gold. The rally underscores the growing role of tokenized commodities as investors seek stability amid volatile crypto markets. With PAXG now trading above $4,400, the token has become a focal point for traders looking to hedge against uncertainty while capitalizing on gold’s historic highs.

Record-Breaking Rally

PAXG recently soared to an all-time high of $4,407.52, surpassing spot gold’s peak of $4,364.82. On Binance, the token briefly spiked to $4,790, reflecting intense bidding pressure and liquidations of short positions. This surge pushed daily volumes above $854 million, a record for the asset. The rally coincided with gold itself breaking $4,300 for the first time, fueling demand for tokenized exposure to the precious metal.

Premium Over Spot Gold

Unlike traditional gold markets, PAXG trades without the limitations of physical settlement, allowing rapid inflows during periods of heightened demand. This flexibility enabled the token to command a premium over spot prices, with Binance showing trades at $4,410. At one point, targeted trades drove PAXG above $5,000, highlighting its susceptibility to sharp moves. While the premium reflects strong demand, it also raises concerns about potential corrections if liquidity shifts.

Market Context and Investor Behavior

The breakout came as Bitcoin retreated to the $108,000 range, prompting investors to rotate into gold-backed tokens as a safe haven. On-chain analysis revealed that funds flowed into PAXG and other gold-linked assets as traders sought to preserve gains amid market volatility. In total, gold-backed tokens now represent $3.39 billion in locked value, a small but growing segment of the broader crypto market.

Competition Among Gold Tokens

Despite PAXG’s surge, Tether’s XAUT remains the largest gold-backed token by market capitalization, trading at $4,373.04 with claims of higher reliability. However, PAXG’s momentum has positioned it as a strong challenger, especially given its record volumes and premium pricing. The token’s rapid ascent underscores the appeal of tokenized commodities, though its volatility suggests that corrections could follow just as quickly as rallies.

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Filed under: News - @ October 17, 2025 11:30 am