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Commodities In Fashion: GoldMint Gives Stale Trading A Blockchain Facelift

Wilma Woo | Sep 02, 2017 | 12:10

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Commodities were once synonymous with old money and the elite, but in the age of cryptocurrency, they are making an unstoppable comeback.

Commodities in the Age of Crypto

In 2017, commodity trading focused on precious metals particularly is becoming vogue once again – but this time for anyone with Bitcoin holdings.

While commodities naturally come in more forms than metals – energy and foodstuffs, for example – it is gold that has found a natural rebirth as a tandem partner with cryptocurrency owners.

Gold remains stable. Despite its comparatively underwhelming performance versus Bitcoin for shorters, the metal fundamentally serves its purpose as a shield from fiat controls.

“The broad masses of the population are interested in buying stable assets backed by real gold, as most local currencies experience a devaluation against the dollar. Use of Blockchain  technology simplifies this process and makes it more transparent for all participants,” Dmitry Pluschevsky, CEO of Blockchain-based gold platform GoldMint explained to Bitcoinist.

‘Backed By GOLD’

Stemming from the cryptocurrency industry, an increasing array of startups are offering investors exposure to precious metals through the medium of digital tokens instead of brokers and dealers.

GoldMint is positioning itself as a advancement which will revitalize the tired pawnbroker industry and its reputation, offering trading and storage of gold assets combined with a gold-backed digital asset, GOLD tokens.

The ecosystem is designed to be self-sufficient, swapping human links in the chain for Blockchain-powered automation, principally in the form of a so-called Custody Bot which creates an immutable record of every operation.

The machine functions are an automated pawnbroker, storing, inspecting and weighing gold while remaining independent of third parties using Blockchain-backed data.

“We think it is very important to have direct proof of the commodity backing tokens,” CTO Konstantin Pichugin continued.

“Let’s imagine there is no any proof-of-assets protocol. It means nobody really understand how much commodity we really have. In this case nobody will trust us. Such token will be the same as USDT and only people who love huge risk would use it.”

Marrying Digital Tokens With Commodity Support

The concept of a commodity backing digital tokens is already not entirely new. Bitcoin holders have long been able to use their digital assets to hold gold and even take physical delivery of ingots to cut out third party storage altogether.

Like legacy commodities trading, GoldMint also uses exchange-traded funds (ETFs) to facilitate investor exposure.

As Blockchain technology progresses at a record pace, however, so are the solutions it can support, making the GoldMint Custody Bot a newcomer to the gold industry.

“GOLD cryptoassets have to be considered as a hedging instrument,” Pluschevsky added.

“While almost all cryptocurrencies are very turbulent, GOLD cryptoassets backed with real gold bullions and ETF have extremely low volatility.”

The project is still in its infancy despite the technology rollout, however, and an ICO on September 20 is intended to launch GOLD onto the world stage and fund the roadmap for the next few years.

Participants will receive bonus token allocations for early participation.

What do you think about commodity trading’s comeback on the Blockchain? Let us know in the comments below!

Images courtesy of GoldMint