In brief
- Tether introduced the term Scudo on Tuesday to represent 1/1,000th of a troy ounce of gold.
- The stablecoin issuer thinks the term could bolster gold’s use in payments.
- Tether issues a gold-backed token, XAUT, and holds nearly $17 billion worth of gold.
Tether moved to establish a new unit of account for gold on Tuesday, as the stablecoin industry leader argued that transactions denominated in “Scudo” could simplify the precious metal’s use in everyday payments.
Under the stablecoin issuer’s definition, one Scudo would equate to one-thousandth of a troy ounce of gold—as well as its XAUT token, which is valued at $2.3 billion, according to CoinGecko. The token’s market cap has nearly quadrupled over the past year.
In a blog post, Tether acknowledged that demand for gold has been bolstered worldwide by “persistent inflation concerns, heightened interest-rate uncertainty, record central bank purchases, and growing demand for safe-haven assets.”
Although a lion’s share of the firm’s products are pegged to the U.S. dollar, it described those factors as an “opportunity to restore gold” to its former status: a universally accepted medium of exchange that can’t be devalued by a government’s ability to print money. The company added that its wallet developer kit can help support XAUT on virtually any device.
Tether noted that “satoshi” is already used in a similar way to Scudo, as a way to refer to the smallest unit of Bitcoin, or one hundred-millionth of a Bitcoin. One satoshi is currently worth around $0.001, while one Scudo would be worth roughly $4.48.
Tether’s term dates back to the 16th century, more than 400 years before the first version of the internet was developed. Scudo was used to describe a variety of coins in Italy, likely hammered from metal blanks. The term was derived from the Latin word for shield.
The parallel with Tether’s logo may be coincidental, but CEO Paolo Ardoino and CFO Giancarlo Devasini were both born in Italy. Last year, Tether acquired a minority stake in football club Juventus, one of Italy’s most storied soccer clubs. An all-cash offer to buy a majority stake in the team was rejected last month.
Tether said that its introduction of Scudo does not change the fact that gold backing its XAUT tokens is “held in secure vaults.” If an individual would like to redeem their tokens, the company’s website says it can deliver gold bars to “any physical address in Switzerland.”
According to Tether’s website, XAUT is backed by 1,329 gold bars equivalent to 16.2 metric tons. The firm published its first attestation report from BDO Italia for the token last April, which did not comply with international financial reporting standards because it did not include primary disclosures and statements from the stablecoin issuer. Tether’s critics have called on the industry’s leading stablecoin issuer to receive independent audits for a decade.
In April, Ardoino said on X that XAUT was “gaining important traction in emerging markets.”
Tether also offers a token called Alloy, which it bills as a “Tethered Asset.” By pledging XAUT tokens, the company says customers can receive a lesser amount aUSDT tokens, which mirror the functionality of its $187 billion stablecoin and are also pegged to the U.S. Dollar.
A few months before Tether’s XAUT debuted, stablecoin issuer Paxos began offering PAXG, the first digital asset that could be redeemed for gold. That token’s market cap stood at $1.7 billion on Tuesday, while tripling over the past year, according to CoinGecko.
Paxos, which also issues PayPal’s PYUSD stablecoin, said PAXG would become “the only institutional-grade gold token issued under federal regulatory oversight,” following the Office of the Comptroller of the Currency’s approval of a national banking charter last month.
Tether’s XAUT may be worth $2.3 billion, but the stablecoin issuer says it owns much more gold than that. The firm said it held 116 tonnes of gold as of the end of Q3 2025, with that tally valued at nearly $17 billion as of Tuesday.
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