The defensive status of the US dollar is facing severe challenges amid the volatile start to 2026. RadexMarkets indicated that as the current US administration expresses a more "laissez-faire" and open stance on the dollar exchange rate, the US Dollar Index (DXY) has experienced sharp fluctuations, plunging 125 basis points on Tuesday to around 95.8, hitting its lowest level since early 2022. This policy-driven orientation has injected strong momentum into safe-haven assets, allowing gold and silver to extend their nearly frenzied upward trend in late January trading.

Market buying power is demonstrating an unprecedented level of diversification. According to the latest data, stablecoin giant Tether significantly accelerated its efforts in the fourth quarter of 2025, increasing its gold holdings by approximately 27 tons in a single quarter, elevating its total reserves to a historic high of around 104 tons. RadexMarkets observed that this allocation demand, driven by crypto asset giants, is becoming an incremental force that cannot be ignored in traditional physical markets. Currently, the market capitalization of gold-backed tokenized asset XAUT has surpassed $2.3 billion, while the market cap of the leading stablecoin USDT has broken through the $180 billion mark. This "sovereign-level" holding scale of gold by such emerging financial forces is altering the pricing weight of precious metals.

Despite gold prices rapidly testing highs of $5,250 per ounce and silver surging to $115 per ounce, the safe-haven attributes of precious metals remain irreplaceable in the current environment of uncertainty. Simultaneously, the Federal Reserve (FOMC) chose to maintain the interest rate range of 3.5% to 3.75% at its January meeting, aligning with prior market expectations. As the Fed enters an observation period following consecutive rate cuts, the interest rate market currently anticipates that the window for rate cuts may not reopen until June; this "policy vacuum," combined with the government's tacit approval of a weaker dollar, provides an ideal tailwind for lifting gold and silver prices.

The renewed decline of the US dollar and the strategic accumulation by institutions like Tether together form the underlying logic of the gold and silver bull market at the beginning of 2026. As gold's dual anchoring role in both digital assets and traditional reserves continues to strengthen, although assets like platinum and palladium have seen some pullbacks in the short term, the leading position of gold and silver remains solid. RadexMarkets concluded that investors should closely monitor subsequent government statements on exchange rates and the interplay of expectations surrounding June rate cuts, noting that volatility in precious metal assets will remain elevated during the dollar's search for a bottom.