Summary
LlamaRisk supports the proposed increase to XAUt supply cap from 5,000 to 10,000 and debt ceiling increase from $3M to $25M. The asset, technological, and counterparty risks remain unchanged since our previous analysis. The circulating supply of XAUt on Ethereum has more than doubled over the past six months, currently reaching 522K ($2.2B). The DEX liquidity on Ethereum has remained steady, with an increase in DEX venues and low LP concentration observed, which reduces the risk of liquidity crunch in a market stress situation. Overall, market liquidity conditions have improved, making it feasible to support a higher supply cap and debt ceiling.
Asset Risk
According to the Asset Allowlist Classification (AAcA), XAUt is categorized as a Tokenized Commodity. XAUt’s counterparty and technological risk on Ethereum, including smart contract risk, bug bounty program, dependency, and access control risk, remain unchanged since our XAUt Core onboarding review in June 2025 and are excluded here for brevity, as no new contracts have been deployed, and the underlying architecture remains identical.
The latest quarterly reserves report (as of September 30, 2025) reported 375,572.297 fine troy ounces of gold vaulted in Switzerland, against 375,572.247 tokens in circulation, which confirmed a 1:1 backing at the time. The current onchain supply as of December 1, 2025, has increased to 522,089.3 XAUt, as shown below, and has more than doubled in the past 6 months since our previous assessment.
Source: XAUt Circulating Supply on Ethereum, Dune, December 1, 2025
Market Risk
Source: XAUt/USDT Swap Liquidity, DeFiLlama, December 1, 2025
On Ethereum, users can swap 2231 XAUt worth up to $9.5M for USDT within a price impact of 6%, and this liquidity has remained broadly consistent with levels observed six months ago. Additionally, XAUt is actively traded on major CEXs, providing further secondary market depth, where roughly $5M of XAUt can be sold within a 2% spread.
DEX LP Concentration
The liquidity of XAUt on Ethereum is evenly distributed across multiple protocols with low LP concentration. Below is the breakdown for the top 5 pools by TVL on Ethereum (as of December 1, 2025):
- Uniswap V3 XAUt/WBTC ($7.62M TVL): The largest supplier, an EOA 1, provides 37.89% of the pool’s liquidity.
- Fluid PAXG/XAUt ($6.39M TVL): A multisig is the top supplier with a 25% share of the pool’s liquidity.
- Uniswap V3 XAUt/USDT ($6.29M TVL): The top supplier, UTGL, provides 15.97% of the pool’s liquidity.
- Curve XAUt/PAXG ($3.53M TVL): Convex Protocol is the top supplier at 44.1% share of the pool’s liquidity.
- Uniswap V3 PAXG/XAUt ($2.95M TVL): EOA 2 is the pool’s top supplier, at 19% share of total liquidity.
Disclaimer
This review was independently prepared by LlamaRisk, a DeFi risk service provider funded in part by the Aave DAO. LlamaRisk is not directly affiliated with the protocol(s) reviewed in this assessment and did not receive any compensation from the protocol(s) or their affiliated entities for this work.
The information provided should not be construed as legal, financial, tax, or professional advice.