Crypto

3 Gold-Backed Cryptocurrencies That Shine Brighter Than Bitcoin

If you’ve been watching the stock market lately, you know inflation and cryptocurrencies are a priority. Will consumer prices continue to rise? Will cryptocurrency prices go down again? Traders cannot be sure what makes the idea of ​​a gold-backed cryptocurrency so attractive right now.

Gold-backed cryptocurrencies are a way to combine the best digital currencies with inflation hedging. In other words, it is a way to profit from precious metal while doing cryptocurrency at the same time.

In an article for CoinDesk on the growing adoption of a gold-backed cryptocurrency, Muyao Sheng revealed that a number of cryptanalysts believe the new interest makes a lot of sense. Vetle Lunde, an analyst at Arcane Research, calls this asset class “very practical tools for investors.” Lunde is not alone – the market capitalization of gold-backed cryptocurrencies has increased 30-fold since the beginning of 2020.

Without a doubt, this is a testament to the growing appeal of this segment of the cryptocurrency world.

If you are thinking of investing in a gold-backed cryptocurrency, you are in luck. These three options merit further consideration here.

Gold Backed Cryptocurrencies: Tether Gold (XAUT-USD)

Concept token for the Tether cryptocurrency (USDT).

Source: DIAMOND VISUALS / Shutterstock.com

Attached (CCC:USDT-USD) is perhaps best known for its USD stablecoin, but Gold tie (CCC:XAUT-USD) also deserves the attention of investors. The Tether Gold token debuted in early 2020 and is one of the most popular gold stabilized currencies available today.

Tether Gold aims to leverage the efficiency of converting gold to any global fiat currency and also eliminates the problem of moving physical gold. Tether Gold’s white paper suggests use cases such as being included in a portfolio as a hedge against financial volatility.

As with USDT, the XAUT value is protected by physical vault containing the underlying Tether Gold assets. Tether holds one USD for each USDT token in circulation. Likewise, each XAUT is backed by its own ounce of gold.

Tether Gold may be one of the best options in terms of brand awareness. But his problem is the volume of the exchange. There are currently only a few exchanges through which you can buy XAUT. Bitfinex, Btse as well as FTX these are your only bets on buying a chip. While they are not tiny exchanges, they are not as popular in the United States.

PAX Gold (PAXG-USD)

The Paxos Crypto Site (PAX) is displayed with a logo background.The Paxos Crypto Site (PAX) is displayed with a logo background.

Source: Grey82 / Shutterstock.com

PAX Gold (CCC:PAXG-USD) is another gold-backed cryptocurrency backed by the well-known stablecoin. The token is a product of Charles Cascarilla, the founder of Paxos standard (CCC:PAX-USD), another token pegged to the USD.

PAXG could be the first gold-backed cryptocurrency. Crypto was launched in late 2019 and is one of the most popular gold-backed digital currencies alongside Tether Gold. However, where PAX Gold exceeds XAUT is its exchange environment.

PAXG is available for purchase on some of the world’s largest exchanges. Binance, Kraken as well as Uniswap everyone is wearing PAXG. Money also has the advantage of being entirely built on Ethereum (CCC:ETH-USD), which means it is standardized by the ERC-20 token model and therefore can be traded on a large number of other exchanges.

The downside of the currency is also the verification algorithm. The PAXG token currently uses proof of work, which is known to be energy intensive. However, as Ethereum is working to move towards a less resource-intensive Proof-of-Stake model, things will be fine soon.

Gold Backed Crypts: Asia Broadband (AABB)

Aerial view of a group of popular cryptocurrency tokens.Aerial view of a group of popular cryptocurrency tokens.

Source: Shutterstock

Broadband in Asia (OTCMKTS:AABB) is a very popular and speculative game in the mining industry. He is also the creator of one of the newest gold-backed cryptocurrencies. Gold AABB (CCC:AABBG-USD).

AABB is a company that is well versed in rebranding from digital media to education and mining. The company recently started to enter the cryptocurrency market. The company is now merging its mining business with its cryptocurrency business to create a gold-backed cryptocurrency.

The company backs this token with its own gold from mines in Asia and Mexico. It is already a success, with investors trading in the AABBG for $ 1 million since spring. Unlike previous games, AABBG is not exactly a stablecoin. The token represents a tenth of a gram of gold, not a whole ounce. This significantly reduces the cost.

AABBG can be incredibly popular right now. However, this also has its drawbacks. Currently, the only way to buy AABBG is by using the Asian Broadband Exchange.

This issue will become less apparent in the fall, when the company plans to release its exclusive exchange. The advanced app will allow users to move their AABBGs faster and convert them to other fiat.

At the time of publication, Brenden Roerick did not have (directly or indirectly) any positions in the shares mentioned in this article. The opinions expressed in this article are those of the author in accordance with InvestorPlace.com’s publishing guidelines.

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