The Future of Gold-Backed Cryptocurrencies
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Gold has been one of the world’s most valuable commodities for centuries, increasing steadily over time. In addition, gold has no direct correlation with other asset classes, making it less susceptible to the whims of the market and, consequently, a smart investment hedge against inflation or economic uncertainties. These attributes are causing gold-backed cryptocurrencies to gain popularity in recent years.
The massive jump in market capitalization regarding gold-pegged coins, whose value is directly linked to the price of physical gold, reflects investors' confidence in the union of gold and crypto. Early this year, stablecoins backed by gold collectively reached over USD1 billion in market cap for the first time in history, representing a 60 percent growth.
“As more people understand the value of cryptocurrencies, combined with the long history of gold as a safe-haven asset, it will only be a matter of time before gold-backed cryptocurrencies become widely adopted,” said Deven Soni, CEO of Matador Gold Technologies. “In times of economic uncertainty, gold is known to be a safe investment and a secure way to preserve wealth. With gold-backed cryptocurrencies, more people will now easily access gold as a tool to protect their assets.”
As a borderless and decentralized asset, gold-backed cryptocurrency offers a much easier and seamless onboarding process for anyone around the world to invest in gold and digital coins. Moreover, gold-backed stablecoins remain safe investments despite growing geopolitical tension and high inflation, making them a compelling asset for any investor.
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