As of the end of March 2026, in the eastern eighth time zone, the People’s Bank of China announced the latest official reserve data, indicating that in that month, it once again increased its gold holdings by 160,000 ounces (approximately 4.98 tons), raising the gold reserve level from 74.22 million ounces at the end of February to 74.38 million ounces. This signifies that since the last round of accumulation began, the central bank has been increasing gold holdings for 17 consecutive months, representing the longest buying intensity since records began in 2002. At the same time, UBS lowered its gold price forecast to $5,200/ounce within the same time frame, indicating that some large institutions still lean towards a bearish or cautious stance, creating a stark contrast between the official "long-term buying" and the institutions' "reduced expectations." As geopolitical risks heat up and the global tightening environment has not fully dissipated, the path of capital redistribution between gold and other major asset classes is becoming a key insight to observe changes in sovereign funds and market risk preferences.

17 Consecutive Months of Gold Buying: Scale and Pace

From the latest disclosed data, in March 2026, the People's Bank of China net increased its holdings by 160,000 ounces, raising the official gold reserves from 74.22 million ounces to 74.38 million ounces, corresponding to a tonnage increase from approximately 2308.5 tons to 2313.48 tons, with a single-month increase close to 5 tons. Under the premise that the structure of global foreign exchange reserves is not fully transparent, this steady increase in absolute scale is a primary focus for interpreting the central bank's allocation tendencies.

Based on public records since the end of 2024, it can be confirmed that this round of accumulation has lasted for 17 months, marking the longest round of accumulation process since 2002. Unlike past phase-based and jumpy adjustments, this round of operations shows characteristics of "monthly small steps, cumulative long runs," gradually elevating gold's absolute volume within the overall sovereign asset allocation through several months of continuous buying. Due to the lack of synchronized disclosure of segmented proportions of total foreign exchange reserves and some related assertions still being unverified, current analysis can only focus on accumulation scale, pace, and duration structure, avoiding unverified specific numerical inferences regarding proportion weights.

Compared to the gold allocation strategies publicly disclosed by central banks in major developed economies, distinct styles can be observed: some central banks tend to make significant one-time reallocations at a single point in time in response to crises or institutional changes; whereas the People's Bank of China’s current operations are more inclined towards a "steady increase in holdings" approach, using time to replace space while not significantly disturbing market prices, steadily adding a buffer layer of hard assets to its balance sheet. This pace also makes it easier for the outside world to view it as a structural adjustment for the medium to long term rather than tactical trading aimed at short-term price fluctuations.

Official Purchases VS Institutional Bearishness: The Tug of War Over Gold Pricing Power

While the official sector has increased its gold reserves for the 17th consecutive month, the mainstream views from institutions have not demonstrated a consistent bullish outlook. Research briefs show that UBS lowered its gold price expectation to $5,200/ounce in March 2026. This figure currently reflects a judgment from a single institution, more reflecting its internal macro assumptions and asset allocation model results, rather than market consensus. The simultaneous occurrence of steady official purchases and some institutions choosing to lower target prices directly highlights the narrative tension of "who determines the long-term pricing of gold."

The typical bearish or cautious logic from institutions centers around several key lines: firstly, the expectations of real interest rates remaining relatively high in major global economies, meaning that in this environment, the non-yielding asset gold is at a disadvantage when competing with interest-earning assets like bonds; secondly, the risk appetite temporarily rising brings about the expectation of "capital flowing back to equity assets," suggesting that under the premise of growth not significantly slowing, capital will preferentially pursue stocks and credit assets with profit elasticity. From this perspective, gold seems more like an insurance position to be concentrated on when tail risks become apparent, rather than a mainline allocation target.

In contrast, there has emerged a voice of "gold demand differentiation: official accumulation vs. institutional reduction," on one hand, central banks and official departments are slowly increasing gold reserves, while on the other hand, some asset management institutions, based on return-volatility ratios and carry considerations, are reducing or at least halting their allocation to gold. This differentiation is not simply about "who is smarter," but rather stems from the natural differences in timelines and objective functions:

● Central banks tend to build a long-cycle safety net through gold, aiming to hedge against external shocks to their sovereign credit and the credit, interest rate, and exchange rate risks in reserve assets, placing more emphasis on payment and settlement capabilities under extreme circumstances rather than short-term drawdown control.
● Institutional investors, however, are more focused on short to medium-term yields and funding costs, paying attention to the relative cost-effectiveness between gold and interest rates or equity market volatility. In a high-interest-rate environment, the opportunity cost of holding non-yielding assets significantly increases, driving them to reduce allocations or shift towards bond assets with stable coupons.

In this structural division of labor, the divergence between official buying and institutional expectations reflects more the misalignment of different types of fund managers in terms of functional positioning and assessment cycles, rather than a simple wager on "whether gold has value."

Hedging Against Risks and Dollar Risk: Central Bank Asset Composition Considerations

Rhythm BlockBeats summarizes this round of accumulation as "standard hedging operations in response to risks in the dollar system," highlighting gold's core role in sovereign assets: on the one hand, its non-credit attribute, which does not rely on the payment commitments of any single sovereignty or institution; on the other, its ability to act as the "final insurance" among reserve assets in extreme scenarios. In a global financial system priced and settled in dollars, gold is one of the few asset forms capable of completing value transfer without relying on third-party credit, which is also its long-standing foundation at the sovereign level.

In the context of rising geopolitical tensions, increasing sanction risks, and strengthening demands for reserve diversification, even amidst quantitative tightening and a high-interest-rate cycle, some central banks are choosing to counter-cyclically increase their gold holdings. The logic behind this is that while tightening monetary policy does indeed elevate nominal yields of dollar assets, particularly U.S. treasuries, it also amplifies concerns over the soft landing of the U.S. economy, the timing of policy shifts, and the potential diffusion of sanction tools. For some sovereign entities, when weighing returns against safety, they might moderately sacrifice some yield to obtain a buffer layer against credit and political risks.

It is important to emphasize that due to the current considerable controversy surrounding terms like "de-dollarization strategies" and the verification status of some information, this discussion only explores gold's role from the perspective of asset diversification and risk hedging, without making political qualitative judgments about specific geopolitical or monetary system directions. It is certain that the repeated increase in gold allocations at the sovereign level is because it possesses:

● Liquidity and Settlement Neutrality: Major global financial centers can provide high liquidity for gold, and it does not carry performance requirements tied to any single sovereign, making it relatively neutral in cross-border settlements.
● Correlation Differences with Government Bonds and Foreign Exchange Assets: Under certain macro scenarios, gold may exhibit low or even negative correlation with U.S. treasuries or major currencies, helping to reduce extreme tail risks at the portfolio level.

At the same time, gold is not a risk-free asset, as its price is still influenced by real interest rates, the strength of the dollar, market sentiment, and liquidity conditions, and it also faces costs of storage and circulation during holding. Central banks' purchases are more of a choice to reallocate weights among various risks rather than a directional "bet" on gold as a single asset.

Capital Diversion Patterns: From Treasuries to Gold to On-Chain Assets

From the perspective of major asset rotations, the logic of global funds rebalancing between U.S. treasuries, gold, and commodities in a high-interest-rate environment is becoming evident: when nominal and real interest rates are high, some conservative funds tend to embrace high-rated bonds to lock in certain returns; however, as geopolitical uncertainties and credit concerns increase, gold and certain commodities gradually become hedging tools, attracting some funds to migrate from treasuries, reshaping the risk-return structure of their portfolios.

In this macro context, the derivatives market and on-chain assets also provide another route for capital diversion. The brief mentions that Bitget has launched a new user contract subsidy program, and while specific rules and marketing details are not elaborated, this action itself reflects an increase in the activity level of the contract market, with more traders attempting to hedge or amplify price trends brought about by macro volatility through leveraged tools. At the same time, the whale activities related to ONDO were seen as a signal of funds shifting towards alternative asset allocations, as some investors began to shift their attention from traditional interest rates and precious metal assets to on-chain yields and RWA-related products.

Without excessively extending this to individual projects and platforms, a simplified asset allocation chain can be constructed:

● Sovereign Funds: Adjusting the weight between gold and foreign exchange reserves, leaning towards increasing gold holdings to enhance the shock resistance of the balance sheet.
● Institutional Funds: Swinging between bonds and gold; when interest rates and inflation expectations change, dynamically balancing the ratios of gold and long-term bonds to meet yield and hedging demand.
● High Risk Tolerance Funds: Some shifting towards encrypted derivatives, RWA tracks, and other on-chain assets, seeking higher beta and relative returns in a macro volatility environment using high leverage or structured yield products.

The resulting capital diversion patterns indicate that gold is no longer a singular "safe haven endpoint," but rather embedded in a more complex cross-market allocation chain, forming a multi-layered risk-bearing system along with U.S. treasuries, commodities, and on-chain assets.

Mapping to the Crypto Market: How Risk Aversion Sentiment Transmits Across Markets

The central bank's increase in gold holdings for 17 consecutive months releases a long-term pricing signal for future uncertainties: sovereign entities are reserving a thicker safety pad for potential systemic risks. This signal will inversely affect the market's understanding framework of risk asset discount rates and premiums, and inevitably contrasts with the narrative of Bitcoin as "strong digital gold." When the official purchases are of physical gold rather than any on-chain assets, the market must re-evaluate: which risks are borne by sovereign assets and which are borne by highly volatile crypto assets.

Combining the on-chain dynamics of ONDO and other RWA projects, it can be seen that some capital is attempting to transfer the "gold logic" onto the chain by holding tokenized products linked to real-world assets to gain bond-like or gold-like yield and risk characteristics. These products attempt to carry real-world credit or asset cash flows onto the blockchain to improve capital efficiency and programmability, becoming a bridge between traditional safe-haven assets and the native crypto ecosystem. In this narrative, the "hard asset safety net" represented by gold is partially replicated within on-chain yield products and the RWA track.

From a derivatives perspective, the increased activity of platforms like Bitget indicates another trend: more traders are inclined to hedge against price fluctuations from macro variables via high leverage and long-short tools rather than relying solely on spot ownership to bear all risks. In the context of divergence between central bank gold accumulation and institutional expectations, these derivatives provide the market with a low-cost way to "bet on macro pathways," increasing the sensitivity of risk asset prices to short-term sentiment and event shocks.

It is particularly important to strictly distinguish sovereign long-term allocations from retail or institutional short-term trading behaviors. Central banks purchasing gold are mainly for considerations of balance sheet safety nets and sovereign credit hedging; it should not be simplistically interpreted as a positive endorsement of any specific on-chain asset; similarly, the price fluctuations of Bitcoin or RWA tokens do not necessarily have direct causality with official gold operations. For participants in the crypto market, it is more important to place these actions within the framework of macro asset correlations and capital costs, rather than mechanically mapping single events as price bullish or bearish signals.

Long-Term Gold Purchases and Layered Risk Games on the Chain

In summary, the People's Bank of China has continuously increased its gold reserves for 17 months, reaching approximately 7438 million ounces (2313.48 tons) of official holdings by March 2026. This long-term, steadily paced buying intensity primarily serves the asset safety net and dollar risk hedging needs, contrasting sharply with the short-term cautious attitude of institutions like UBS lowering their gold price expectations during the same period, also highlighting fundamental differences in time dimensions and objective functions among different funds.

Looking ahead, key variables that influence the relative attractiveness of gold and risk assets include: the interest rate paths of major global economies (how long high interest rates can persist), the intensity and frequency of geopolitical frictions, and the attitudes of regulatory agencies towards cross-border capital flows and new asset forms. These factors will collectively determine whether sovereign funds continue to increase gold allocations, whether institutions reassess the relative cost-effectiveness of gold versus bonds, and the level of activity from high-risk-tolerance funds in on-chain derivatives and the RWA track.

For crypto investors, the greater significance of this round of central bank gold accumulation is one of insight rather than direction: when interpreting hedging signals, attention should shift from single-asset price forecasting to the correlations and hedging efficiencies at the asset portfolio level. For example, evaluating the covariances between Bitcoin, RWA tokens, and gold, and U.S. treasuries under different macro scenarios, rather than simply deriving price paths from a "digital gold" label. Furthermore, regarding sensitive topics such as the proportion of gold in foreign exchange reserves and "de-dollarization strategies," current public data is still limited, and some assertions remain unverified. Analysis and decision-making should be bound by verifiable information, avoiding excessive derivations in the absence of data support.

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