What is Crypto Gold Trading? How is it Different from a Physical Gold Shop?

Types of Gold in the Crypto World

Before trading gold in crypto, you must understand that it comes in several forms:

• PAXG (PAX Gold): A token backed by physical gold bars. 1 PAXG = 1 troy ounce of gold stored in Paxos vaults in New York. Holding PAXG is equivalent to owning physical gold.
• GOLD (HIP-3 on Hyperliquid): Perpetual futures with prices pegged to global gold rates. You can trade 24/7 and use leverage, but it is not backed by physical gold—it is a price-betting contract.
• xAU: Synthetic gold on other protocols, functioning similarly to perpetuals.

On SiamDEX, we trade GOLD via HIP-3, which follows the perpetual futures model.

How is it Different from a Gold Shop?

Buying from a gold shop usually means purchasing physical bars or jewelry to store. Trading GOLD on SiamDEX differs in 4 key areas:

• Premiums/Fees: Local gold shops often charge a 1-2% premium per transaction. SiamDEX charges only 0.035% (combined taker fee + builder fee).
• Trading Hours: Physical shops are generally open Monday-Saturday during business hours. SiamDEX is open 24/7, including holidays.
• Leverage: Shops require full payment for the gold. SiamDEX allows leverage, meaning you need less capital to open a position.
• Storage: Physical gold requires a safe or storage fees. GOLD on Hyperliquid eliminates these physical security concerns.

Why is Gold a Safe Haven Asset?

Gold has been used as a store of value for thousands of years. Here is why prices often surge during crises:

• Dollar Depreciation: Gold is priced in USD. When the dollar weakens, it takes more dollars to buy gold, driving the price up.
• High Inflation: As fiat currency loses purchasing power, investors flock to gold as a hedge.
• War and Uncertainty: During conflicts, people prefer gold over fiat currencies that might face hyperinflation.
• Fed Rate Cuts: When bond yields drop, gold—which pays no interest—becomes more attractive to investors.

How to Trade Gold on SiamDEX

• Go to siamdex.com and connect your MetaMask.
• Click the + button in the Asset Selector to add a new asset.
• Select the HIP-3 tab.
• Search for GOLD and select it.
• Choose Long if you believe the price will rise, or Short if you believe it will fall.
• Set your leverage and margin, then click Place Order.

Fee Comparison: Thai Gold Shops vs. SiamDEX

• Thai Gold Shops: Premium/Processing fees of 1-2% on purchase + another 1-2% on sale = Total 2-4% per cycle.
• SiamDEX: Taker fee 0.025% + Builder fee 0.01% = 0.035% per trade. This is over 57 times cheaper than a gold shop.

For active traders, these lower fees have a significant impact on compounded profits over the long term.

Risks to Know Before Trading Gold via Leverage

• Gold is generally less volatile than crypto, but when using high leverage, the risk of liquidation still exists.
• Gold prices can drop sharply if the US Dollar strengthens rapidly, such as during Fed rate hikes.
• GOLD on HIP-3 is a synthetic asset. If the underlying exchange faces issues, it could affect liquidity.
• We recommend using leverage of no more than 5x for gold; while it is less volatile than crypto, risk management is still essential.