KPMG U.S. issued an unqualified opinion on the 2025 financial statements of TG Commodities, the issuer of Tether Gold (XAUT), a move that confirms the token’s physical backing with a level of scrutiny previously absent from the stablecoin sector. The audit covers the year ended December 31, 2025, and finds that the company held 520,089.35 fine troy ounces of allocated gold valued at $2.246 billion against 520,089.30 XAUT tokens in circulation. Each token represents an undivided ownership interest in specific bars stored in Swiss vaults, and the auditors verified this linkage by physically counting and inspecting every single bar rather than relying solely on custodian confirmations. This direct verification process addresses long-standing criticisms of Tether’s reliance on quarterly attestations, which only provide a snapshot of reserves at a single moment instead of examining full financial statements over a year. The clean opinion signifies that the statements fairly present the company’s finances in all material respects under U.S. accounting rules, offering a clearer picture than the standard industry practice.
Verification Methods and Financial Scope
The distinction between this audit and previous reports is critical for understanding the current state of transparency in digital assets. An attestation checks one specific claim at a single point in time, whereas an audit examines a company’s full financial statements across an entire year. KPMG’s team did not accept the custodian’s word; they inspected the identifying information on each bar to ensure the gold matched the token supply exactly. As of the end of 2025, the company held unsold tokens totaling 110,871.66, a figure that grew to 118,093.97 by September 30 according to BDO’s separate report. Tether’s Chief Financial Officer Simon McWilliams stated that the audited figures are consistent with the reserves published every quarter, reinforcing the reliability of their public data. He added that the strategy was deliberate, aiming to start with the largest and most complex businesses to set the standard for the industry. This approach follows KPMG’s similar clean opinion on Tether International, the issuer of USDT, announced in August, which marked the first major step toward auditing the entire Tether ecosystem.
Market Implications and Supply Growth
The audit results align with significant growth in XAUT’s supply since the balance sheet date. Tether reported on November 4 that XAUT’s gold reserves grew 59% from the end of 2025 to September 30, reflecting strong demand for the asset. By Thursday, the Ethereum contract showed 827,417.63 tokens, meaning roughly 37% of today’s supply was added after the audited period ended. CEO Paolo Ardoino believes XAUT is on track to become the first true competitor to the gold ETF market, a bold claim supported by the rigorous validation of its backing. However, the lack of public access to the actual audit report or the audited financial statements remains a notable gap in the disclosure process. Tether has not released these documents on its websites, leaving third parties unable to independently verify the auditor’s detailed findings beyond the summary announcement. Despite this limitation, the completion of the second Big Four audit signals a clear shift away from opaque reserve reporting toward standardized financial accountability. The firm continues to store its own large gold reserves in a former nuclear bunker in Switzerland, further entrenching its position in the physical commodity space while expanding its digital offerings.
