Back in August of 2016, the CME Group partnered with the UK’s Royal Mint to formally digitize gold with the RMG – a revolutionary concept at the time but alas, that partnership collapsed. Since then, many other groups have attempted to pick up the slack. Now the Hong Kong Gold Exchange has launched “Goldzip” tokens secured by a commitment of $300 million in physical gold reserves. And, just like the original CME/UK RMGproduct, the tokens come in one gram increments. Aimed to be a trading vehicle, it should track the spot price of gold. Being actively involved in a digital/crypto fund I obviously think its a great idea. Remember, its all about the custodian and where the vault is. A bit more below.
Bill Taylor/Fintek Capital
“A new digital token backed by $300 million worth of gold guaranteed by the Chinese Gold and Silver Exchange (CGSE) has just been released in Hong Kong. Similar to other cryptocurrencies, the new Goldzip tokens will be utilizing highly secure blockchain technology.
The new instrument will be used to trade gold, which is much safer than actually using the precious metal. Blockchain technology is currently tamper-proof and each transaction is “seen” by all the parties involved through a public ledger. This helps minimize fraud and digital hacks.
The $300 million worth of gold was audited by participating members. Once that was completed, the gold inventory was stored inside a vault at the local gold exchange. The auditing process is necessary prior to issue the Goldzip digital tokens, as each piece will directly be linked to one gram of gold on the reserve.
According to the CGSE’s executive director, Calvin Ng, the goal of the new tokens is to allow its owners to make easy and secure transfers and payments with gold. The process will be using blockchain ledger technology, which means that each transaction is full tracked through the blockchain ledger….”