Central banks, ETFs and crypto drove gold rally

Gold’s recent price rise followed three distinct rounds of buying by different groups: central banks, exchange-traded funds and private investors, and crypto-native players. Each group added demand at different times and in different ways.

Between 2022 and 2024, central banks recorded annual net purchases above 1,000 tonnes. That pace of accumulation continued for three consecutive years before easing in 2025 to 863 tonnes, a level still above long-term averages. Disclosed buyers in recent years included Poland; officials and market data indicate a portion of central-bank accumulation occurred without public reporting.

In 2025, institutional and retail flows returned. Global gold ETFs recorded net inflows of roughly 801 tonnes for the year, and total annual gold demand exceeded 5,000 tonnes. Bars and coin sales reached multi-year highs across several regions. ETF holdings were flat or in outflow during 2022–2024 while central-bank buying dominated net demand.

U.S. private financial assets held about 0.17% in gold via ETFs and other vehicles, a level below historical institutional allocations of roughly 1–2%. Supply-side estimates indicate that a move by Western portfolios toward a 0.5% allocation would add an estimated 1,500–2,000 tonnes of demand compared with current levels.

A third layer of demand came from crypto-native finance. Tether’s USDT reserve pool was about $190 billion, with an estimated 10% allocated to gold and roughly 3.5% to Bitcoin. That gold allocation, valued at about $19–20 billion, made Tether one of the larger institutional buyers in 2025, behind only a small number of central banks in reported data. U.S. stablecoin legislation passed in the Senate in May 2026 requires compliant domestic issuers to back tokens with USD cash, short-dated Treasuries or Federal Reserve balances; Tether is incorporated offshore and is not subject to that requirement.

Tokenized gold products have expanded from niche use to a roughly $6 billion market, with about 35–40 tonnes outstanding as of early 2026. Paxos Gold and Tether Gold account for much of that supply. The total remains small, but reported supply doubled over six months. Tokenized gold converts allocated physical metal into digital tokens that can be moved on blockchains and used as collateral in decentralized finance platforms.

New yield-bearing tokenized-gold products combine tokenized positions with derivatives and lending. Some of these products hedge spot exposure with short futures and seek returns from futures-roll benefits in contango and from lending tokenized positions. These structures carry operational and smart-contract risks. A series of decentralized finance exploits in 2025–2026 limited adoption outside crypto-native users.

Each buyer group has a different scale and a different sensitivity to price and economic conditions. Central-bank purchases were driven by reserve allocation and de-dollarization objectives rather than short-term price moves. ETF and private capital flows in 2025 reflected portfolio reallocation and retail interest. Crypto-native demand added new channels for gold to function as collateral in digital markets.

All figures and timing in this report are based on reported purchases and market data and are presented for informational purposes only.