Market Reactions to US Bombing in Iran

• Tether Gold and Paxos Gold surged after the US bombing of Iran.
• Meanwhile, Bitcoin and Ethereum saw a decline.
• Tokenized gold has emerged as a reliable option for investors looking for safe assets.

On Saturday, tokenized gold gained traction as Bitcoin and Ethereum prices dropped, all triggered by the US and Israeli strikes on Iran.

In light of escalating tensions in the Middle East, investors have gravitated toward Tether Gold and Paxos Gold. Both assets soared following the unprecedented attack.

Tether Gold (XAUT) climbed to $5,455 on Saturday morning in New York, though it slightly retreated to around $5,332, still about 5% below its peak from February, marking a 2% increase over the past day.

Paxos Gold (PAXG) also rose by nearly 4%, reaching $5,438 according to CoinGecko, before nudging down from a high of nearly $5,536.

Geopolitical Factors

As Bitcoin experienced a downturn, these two tokenized gold assets thrived, with Bitcoin touching $63,177 at one point during the day.

Following the news of the US attack, Ethereum also saw a significant drop. It’s common for major cryptocurrencies to react strongly to geopolitical upheavals.

Nevertheless, the surge in tokenized gold indicates that these digital assets are providing investors with a quick route to blockchain-based precious metals.

According to DeFirama data, the total amounts of PAXG and XAUT have drawn in more investors, with spot market gold prices hitting new highs this year.

Tether, known for its USDT stablecoin, has been rapidly hoarding gold and is now one of the leading holders of these precious metals globally.

In January, Tether noted that “the demand for secure assets that remain entirely on-chain” is driving growth in its XAUT product.

Bitcoin’s Role as a Safe Haven

Historically, Bitcoin has been considered a safe-haven asset and has briefly mirrored gold in its value.

Last year, it was sold off in a move that affected precious metal prices. Many investors view it as a hedge against potential fiat currency devaluation.

However, that narrative has faced challenges since October, when the crypto market experienced a dramatic downturn.

Bitcoin and Ethereum have struggled to recover in the wake of a significant liquidation event that wiped billions off their market value, leaving them trading well below previous highs.

In contrast, gold continues to reach new heights as we progress through 2026.