TBW - Benjamin Louvet: "Seeing Tether buy 25 tons of gold per quarter is not a systemic shock"
The Big Whale: We're seeing gold really take off at the end of 2025. How would you describe the state of the market today?
Benjamin Louvet: The market is in turmoil: since January, gold has gained more than 50% and is trading at historic levels. Geopolitics is often cited as the driving force (Ukraine, regional tensions, etc.) but its direct effect remains limited. The real shock is the freeze on Russian assets decided by Western countries.
For many Asian economies, which considered the dollar a safe haven, this decision has created a structural doubt: can a country really still rely on the dollar if it can be seized for political reasons? This loss of confidence in American reliability has redirected some of the demand towards gold.
The other, much more powerful, driver is the overflow of government debt. The United States, for example, has a debt equivalent to 124% of its GDP. This means that every 1 point rise in interest rates over time translates into the equivalent of more than a point of additional GDP in annual interest payments. This is why interest on US debt now exceeds $1,000 billion a year (more than the defence budget).
As gold pays neither coupons nor dividends, its attractiveness depends very much on real interest rates, which must remain low to avoid competition from high-yielding assets. To keep their debt sustainable, governments have no choice but to keep real interest rates low, or even negative. This is the context in which gold thrives.
This gives the impression that gold can only go up, what could encourage a fall in its price?
In my view, we can identify the moment when the rise in gold will stop. As long as governments can live with debt that is too high to be repaid normally, it is in their interest to maintain an environment of low real interest rates, which favours gold. The rise will come to an end on the day that governments finally face up to the issue of debt, in other words, when they accept some form of restructuring, even under a different name. On that day, I think the price of gold will experience a final surge, reflecting the explicit recognition that the old regime was no longer tenable.
Then, with the return of normalised interest rates, gold will mechanically lose its appeal. At that point, we'll probably have to get out of it and not touch it again for twenty years, until a new cycle of excessive indebtedness begins again.
"Emerging countries, which currently have a trade surplus, are accumulating new reserves"
Which central banks are the most active in buying gold?
Historically, Western countries, which already held a lot of gold, no longer buy it: in their case, the yellow metal already represents around 70% of foreign exchange reserves. By contrast, emerging countries, which currently have a trade surplus, are accumulating new reserves and are increasingly choosing to diversify them by buying gold.
The World Gold Council surveys around 70 central banks every year: between 2018 and 2023, around a quarter of them were planning to increase their allocation to gold. In 2024-2025, this figure has risen to 43%, an all-time high, while 0% plan to sell gold.
The two reasons given are crystal clear: firstly, gold has no counterparty risk (it is nobody's debt) and, secondly, central banks expect permanently low real rates, which makes gold structurally attractive. Added to this is a privilege that the general public is often unaware of: central banks can lend gold to each other, and therefore earn a return on it. So for them, holding gold is not as expensive as it is for you or me.
We've seen some pretty heated political debate in Italy . Does this reveal something deeper?
Yes: as soon as the fiscal situation gets tight, politicians dream of getting their hands on central bank gold. But in the eurozone, things are locked up: the treaties guarantee the independence of the central banks and prevent any direct political appropriation. The Bank of Italy's gold belongs... to the Bank of Italy, even though the euro places the institution under the aegis of the ECB.
On the other hand, there is a general trend: countries are seeking to physically repatriate their gold. France has already been doing this for some time via its secure "La Souterraine" site. The Netherlands has repatriated some of its reserves, Germany is interested, and China has just offered to store its gold in a local equivalent of Fort Knox. Vietnam has already accepted. In a less stable world, this makes sense: when international confidence weakens, states want to keep their gold... at home.
"China probably has around 5,000 tonnes of gold, rather than the 2,300 announced"
We also read that China would hold much more gold than it officially says. Should we be wary of the figures?
Absolutely, because the official data are based on voluntary declarations to the IMF. A central bank can say whatever it likes: China once declared "zero purchases" for five years... before revising its accounts to announce several hundred tonnes all at once. A well-known analyst, Jan Nieuwenhuijs, has sifted through Chinese customs figures and estimates that China probably has around 5,000 tonnes of gold, rather than the 2,300 announced.
This raises an interesting question: where has it bought these quantities without panicking the market? Inevitably, this revives doubts about the transparency of US reserves, particularly those at Fort Knox, where partial audits have been criticised for being opaque.
And there is a crucial detail to add: when a central bank lends gold, it remains on its balance sheet. It appears as "gold (including gold lent)" in IMF statistics. In other words, even the official data do not really show where the metal is physically located, or who is actually holding it at time T.
In an extreme scenario, could the United States requisition the gold stored at home, even when it does not belong to it? Is investing in a US gold ETF risky?
In theory, an ETF is a fund, and the assets in a fund are segregated: they belong to their holders, not to the custodian bank. In principle, this architecture protects investors, even if an intermediary goes bankrupt. But history shows that political confiscation can never be ruled out: in 1933, Franklin Roosevelt imposed Executive Order 6102, requisitioning American gold. The scenario is unlikely today, but not conceptually impossible.
As for physical gold, it offers a form of direct control, but poses two real problems: storage, which is often complex and costly, and the (theoretical but real) risk of confiscation. Gold derivatives, on the other hand, offer another advantage: if confiscation were to occur, the markets would simply be suspended and each player would walk away with the value of their contract. Paradoxically, this is not necessarily less secure.
"Tokenisation may be of interest to investors who want to combine a quasi-physical holding with an on-chain utility, or even defer taxation"
We are also seeing a rise in the tokenisation of gold. Players such as Tether, Paxos and MKS Pamp are creating digital tokens backed by physical metal. Is this a revolution or just a niche tool?
In its simplest definition, tokenisation amounts to creating a token representing a quantity of gold stored in a vault. On paper, this offers a more direct form of holding than an ETF, with the added advantage of being mobilisable in decentralised finance. It's attractive, but I doubt that it will become widespread in the short term.
The players who would have the most to gain from it (central banks, sovereign wealth funds, etc.) already have a "gold lending" market, which allows them to lend their gold and earn a return on it. They don't need blockchain for that.
On the other hand, tokenisation may be of interest to more modest investors, who want to combine a quasi-physical holding with an on-chain utility, or even defer taxation. But in my view, this will remain a peripheral solution that does not structurally transform the gold market. The fundamentals (storage, costs and security) remain the same, even if the technological layer changes.
Even if you are cautious about its mass adoption, is it a subject that is taking hold in the traditional gold industry?
Yes, it is clearly a subject of discussion, even if enthusiasm varies greatly depending on the players. The World Gold Council, which acts as the industry's benchmark, has announced that it is working on a tokenised gold project in partnership with the London Metal Exchange, which shows that the issue is no longer marginal. The aim would be to improve traceability, liquidity, and potentially facilitate the use of gold as a mobilisable asset in modern infrastructures.
But make no mistake: these are mainly long-term considerations. The mining industry is very conservative, and tokenisation does not change the physical reality of the metal: it has to be extracted, purified, stored, audited... It remains a heavy and expensive asset to handle. So yes, it's a subject, but it's not an industrial upheaval at the moment, more a serious experiment, closely monitored.
"Tether? Seeing a private player regularly buying 25 tonnes a quarter is not a systemic shock, it's an additional flow"
With a view to diversifying the reserve its stablecoin USDT, Tether was the world's biggest buyer of gold in Q3, ahead of the central banks. Did that surprise you?
You have to put things in perspective. Yes, Tether bought more than a small central bank in a quarter, but its total holding (around a hundred tonnes) is still comparable to that of a modest-sized country, a far cry from the Banque de France's 2,500 tonnes or the hundreds of tonnes accumulated by Poland in recent years.
The interest, in my view, lies elsewhere: Tether appears to be a long-term buyer, with gold as part of its strategic collateral. This means that the metal they acquire is unlikely to return to the market quickly; it is "stable" demand that underpins prices.
The real grey area concerns transparency: where is this gold stored? Is there a full independent audit? For the moment, communication remains limited. But from a purely economic point of view, seeing a private player regularly buying 25 tonnes a quarter is not a systemic shock. It's an additional flow. It's interesting but still nowhere near the cumulative buying power of central banks.
>> Analysis: diving into Tether's diversification strategy
Some reports, such as one by Deutsche Bank published in September 2025, claim that central banks could be holding Bitcoin in their reserves by 2030. Is this credible?
I remain highly sceptical. The key question is: what does a central bank gain from holding Bitcoin? Gold provides an asset with no counterparty risk; government bonds are used to manage international trade; major currencies (euro, yen, yuan) complete the stability of the basket. Bitcoin does not fit into any of these logics.
Why not have small countries do symbolic tests; but making it a reserve asset in the same way as gold seems to me more a matter of industry lobbying than a coherent monetary strategy.
What worries me more, on the other hand, is the idea of a Bitcoin strategic reserve held by the United States. The day a government of that size holds a significant stockpile, it becomes a player capable of influencing the price through buying, selling or political signals. For Bitcoin, this would be the 'wolf in the henhouse': an asset designed to be independent of governments would find itself under their direct influence. In my view, this is much worse news than the hypothetical arrival of Bitcoin in the reserves of small central banks.
Could silver follow gold's explosive trajectory and also experience a major rally?
Silver occupies a singular position, halfway between precious metal and industrial metal, which explains why it does not always react like gold. It benefits from the same climate of geopolitical uncertainty and the same concerns about the strength of the dollar, but its momentum is driven above all by its industrial uses. Silver is the most conductive metal in the world, essential for electronics, batteries, electric vehicles and, above all, photovoltaic panels. In a world undergoing an energy transition, this property has never been so strategic.
A structural element is reinforcing this tension: global silver production reached its peak in 2019. Since then, supply has stagnated or declined slightly, while industrial demand continues to grow. This potential imbalance has many analysts saying that silver could eventually see a much more spectacular rally than gold.
But silver also has a weakness that gold does not: it is harder to store. The metal oxidises and blackens on contact with air, requiring regular maintenance or specialised storage. This constraint makes its physical holding less attractive to some investors and partly explains why it has never played, on a global scale, the same role as gold as the ultimate reserve.
>> Analysis - Tokenised gold: a market ready to explode?
