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6 Gold-Backed Cryptocurrencies To Consider In 2021

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One of the criticisms against cryptocurrencies is they’re not backed by any stable asset. Skeptics say they have no value, which has time and again expressed their doubt in digital currencies. The fact that cryptocurrencies, specifically Bitcoin, have increased their value exponentially since they first came out more than a dozen years ago doesn’t affect these financiers’ opinion about them.

Risk-averse financers believe the cryptos’ volatility and their lack of regulation from any authority like central banks are enough reasons not to invest in them. Uncertainty about their long-term viability has proven to be the main reason why many investors avoid digital money.

But what if cryptocurrencies are backed by something as stable and valuable as gold?

Gold-Backed Cryptocurrencies

Gold has always been regarded as a stable and safe commodity to invest in. It’s a haven asset, a store of value that has continually proven its worth throughout history. Its purchasing power has remained constant through the years, and inflation doesn’t affect it much compared to hard currencies.

Gold is steady, unchanging, and solid. It’s the asset people invest in if they want to preserve their wealth by buying shares in mutual funds, gold Exchange Traded Funds (ETFs—a stock certificate that can be traded), or physical gold like gold coins and gold bullions, which they can get from traders like Oxford and others.

Cryptocurrencies, on the other hand, are the epitome of volatile assets. Bitcoin’s prices, in particular, had swung by as much as 20% almost 50 times since 2010. To be fair, Bitcoin’s prices had also appreciated by more than 800,000% in almost the same period. Still, most finance managers see investing in cryptos as betting on something extremely risky.

However, a new type of cryptocurrency has emerged, one that’s backed by gold. Stablecoins are a new batch of cryptos ‘pegged’ to a commodity with a real, stable value—one that’s not prone to violent price swings

Overview Of Gold-Backed Cryptocurrencies

Cryptos backed by gold have inherent value, something which Bitcoin and the rest don’t have. Their value is connected to the price of gold on the stock market; so when gold’s market price moves, the price of these cryptos follows as well.

These gold-backed digital coins are released with a value equal to gold. A gram of gold, for example, is equivalent to one coin. The gold that’s used to back stablecoins is kept by a trusted third party, and this independent party is authorized to trade with other holders of stablecoins.

With stablecoin’s price tied to the price of gold, it’s virtually assured that its value won’t go below gold’s market price, making it stable. Also, the gold-backed cryptos can surpass gold’s value. This feature makes stablecoins attractive to conservative investors who wouldn’t consider investing in cryptocurrencies.

Evaluating Gold-Backed Cryptocurrency

When it comes to gold-backed digital money, you’d want to be certain it’s indeed backed by gold and it’s in a secure place. Additionally, you should be able to trade it whenever you want or have it redeemed for actual gold you can hold, and not just gold ETFs.

To validate, have it verified by an independent, third-party auditor. If the trader provides an audit report or other documentation, you could check its authenticity by contacting the auditor to confirm every detail. You can also accept in good faith that the coin is genuinely backed by gold based on the issuer’s reputation, which could mean you’d previously dealt with the issuer and they’ve earned your trust.

When you’ve established that the gold is there, you can verify the gold tallies with the number of stablecoins in circulation. You can check the transaction on the blockchain for information regarding the number of coins and the amount of gold held.

Converting Gold-Backed Stablecoins To Physical Gold  

Gold-backed digital coins can be redeemed for physical gold if it’s what you want. The process may vary, but typically, you have to get past the Anti-Money Laundering (AML) and Know Your Customer (KYC) procedures first. The bullion or gold coins would then be shipped to your specified mailing address.

You can also redeem your stablecoins for gold derivatives instead of physical gold. Gold derivatives are financial contracts whose prices follow gold market prices. These can also be exchanged for physical gold.      

Some Pros And Cons Of Digital Gold Coins

These digital gold coins aren’t without risks, however. While cryptos have blockchain technology as a public ledger where anyone can verify each transaction, gold-backed stablecoins aren’t as transparent when it comes to the actual gold. Verifying the gold in stablecoins isn’t as cut and dried. So, selecting which coin to buy would require a bit of investigating to ensure the gold is indeed yours.

They also aren’t immune to volatility, although not as dizzying as Bitcoin’s level. They’re subject to their market forces, so there may be times when these cryptos aren’t as stable as gold. However, they’re much easier to store than the actual metal. And if you want to liquidate a few assets, these digital gold coins are easier to sell than actual gold.

Keep in mind also that unscrupulous people could just be flat-out lying about some gold-backed cryptocurrency project they’re offering. Scammers are everywhere in the world of finance. But with some traders, you’d have to ultimately rely on trust, so tread carefully.

There are also some fees you’d incur. Additional fees regarding custody for the actual gold are usually passed on to investors. Moreover, while tokens are easier to sell than gold, both the liquidity and availability of these digital gold coins could sometimes be limited.

Digital gold coins or tokens may be the next stage for gold investments. And if you’re interested in dipping your toes into the world of gold and cryptocurrencies, read on to know your options.

Gold-Backed Cryptocurrencies Worth Considering

This concept of gold-backed investments was first launched in 1996. It was known then as E-gold years before Bitcoin was even a twinkle in the eye of its purported father, Satoshi Nakamoto. But it ran into legal issues and was beset by cybercrimes, and these problems proved to be too much to hurdle. It was eventually canceled in 2009.

However, some ideas won’t simply die; they just evolve. And now, technologies like blockchain made it possible for digital gold coins to rise again, albeit in a slightly different format. There are many digital gold tokens available today, but it’s a caveat emptor situation: ‘Let the buyer beware.’

However, a few coins could be worth watching. Here are a few gold-backed cryptocurrencies to consider in 2021:

  1. Meld Gold

Managed by the cryptocurrency platform Algorand, this digital gold token offers a streamlined type of gold trading through the use of blockchain. It has a solid team connected to its platform, ensuring a smooth and reliable transaction for traders. It allows you to trade in real-time, minimizing the risks for investors of volatilities that could happen during a slow transaction.

Meld Gold’s backing is also audited by independent third-party auditors to ensure authenticity, and its platform offers investors their wallets to store the coins. Meld Gold is equal to a gram of gold.

  1. Perth Mint Gold Token (PMGT)

Since this is backed by the Perth Mint in Western Australia, the gold’s purity and weight are guaranteed by the government. Additionally, the Perth Mint also issues digital gold certificates through an app called GoldPass. One PMGT is equal to an ounce GoldPass certificate, which is equal to an ounce of pure gold.

A GoldPass certificate backs each token, and they have a 1:1 ratio. You can also redeem the certificates and you can have your gold delivered right to your doorstep. What’s great is PMGT doesn’t have any fees. Neither storage nor transaction nor management fees is charged to investors. It’s one of the most economical gold assets as well as an excellent alternative to conventional gold products.

Investors of PMGT don’t have to wait for monthly audits to verify their token’s gold. Perth Mint publishes the balances of GoldPass accounts so they can be verified in real-time.

  1. PAX Gold

A PAX Gold token is equivalent to a fine troy ounce of one gold bar, which is secured in its platform’s storage. It offers not only low trading fees but also fast transactions. The token’s minimum investment is quite low, so investors of all shapes and sizes can take part in the project.

Regulated by the New York State Department of Financial Services, PAX Gold’s assets are stored in vaults that are the most secure in the world. The bullion is also checked by a team of third-party auditors to ensure everything’s legitimate. Investors could also redeem their PAX Gold tokens for the actual yellow metal.

  1. Digix

Digix is gold-backed crypto with a value of a gram of gold bar per coin. Like other legitimate stablecoins, Digix’s gold bars are all verifiable. Moreover, its platform is accredited by the Bullion Association, which means its assets are covered by insurance in case of theft.

Their gold assets are stored in Canada and Singapore, and you can check these at their website. Their certificates, which are also proofs of purchase, are viewable by anyone visiting their site. This makes it easy for anyone to check their gold assets.

You can also redeem your Digix coins for the actual gold if you want. A one-percent fee, called a recast fee, is levied. Signing up on their platform is relatively straightforward and only takes a few minutes, unlike some platforms that ask for a myriad of verification details.

  1. GSX

GSX is backed by precious metal, not just gold. If you’re an investor, you can have a choice of precious metal to back your stablecoins. Like other above-board stablecoins, GSX has third-party auditors, and they also offer physical gold redemption for your coins. What’s more, as an investor, you can receive annual bonuses to show appreciation for investing in them.

  1. Tether Gold (XAUt)

Tether is known as the largest issuer of US Dollar-backed stablecoin. Their gold-backed stablecoin called XAUt is equal to a fine troy ounce of gold contained in a London Good Delivery gold bar. Tether’s gold assets are held in a vault located in Switzerland.

Token holders can check the serial numbers of their token’s assigned gold bars through Tether’s site. They also let investors redeem their coins for cash or gold; and yes, they can also deliver your gold if your coins are worth a full bar. You can then redeem a number of coins equivalent to a full gold bar.

For example, their bars from the London Bullion Market Association (LBMA) can weigh up to 430 fine troy ounces of gold. You can redeem 430 tokens if they’re allocated to a full gold bar. If you’ve redeemed your tokens for a full gold bar, then either you can take possession of it or you can ask TG Commodities Limited, the issuer, to sell the gold for you.

Final Thoughts

Cryptocurrencies are viewed by many financers as having no inherent value. They also think investing in them is equivalent to gambling at long odds. They don’t think that Bitcoin and others are a wise long-term investment. But now that cryptocurrencies have emerged and backed by something as valuable, tangible, and stable as gold, investors are turning to this new type of cryptos that promise to be unwavering, especially in this age of uncertainty.

However, in buying gold-backed stablecoins, you should tread carefully as there are stablecoin projects out there that are outright scams. There are ways of determining the fake from the real. There are many genuine digital gold coins out there, and some are admittedly more exciting than others. As a rule of thumb, always be informed about your transactions.

The ones listed here are just a few of the coins worth considering. If you want to invest in cryptos without the head-spinning, stomach-churning price swings of Bitcoin, this form of cryptocurrency might be for you. But as always, do your research and don’t be led by your emotions when investing your money.

 

 

Blockchain

The GBA Annual Achievement Awards

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In April 2019, during the Guatemalan election, the people of Guatemala suspected that voting fraud had occurred. Since additional elections were scheduled for August 2019, citizens wanted assurance that there would be no fraud in the next election. That was the impetus for Fiscal Digital, a Guatemalan citizen volunteer organization, to utilize a public immutable blockchain for their elections. Against overwhelming opposition, the Organizer of Fiscal Digital, Carlos Toriello Herrerias, was successful in implementing a blockchain-based voting solution in Guatemala. Carlos was the winner of last year’s GBA Annual Achievement Award for Courage.

The Government Blockchain Association (GBA) is pleased to announce that the 2021 Annual Achievement Awards will be happening live in Washington DC, (9/30/2021) as part of Government Blockchain Week. Four awards will be presented in the areas of Leadership, Innovation, Social Impact and Courage. Nominations of individuals deploying exceptional blockchain use will come from around the globe. From securing land titling records, to self-sovereign medical records, to immutable and verifiable voting, blockchain is affecting every industry that transfers value. The winners of these awards are truly making a mark in history, and there is still time to nominate your colleague.

Winners will be awarded by MC Robert Levin of Emergingstar Capital, from a stage in Washington DC in front of a distinguished audience. Receiving a GBA Annual Achievement Award is a credential that can be listed on Linked In, resume’, and any other social media as a recognized global achievement. Do not miss this opportunity to promote the exceptional achievers in your circle. Nominate them for the GBA Annual Achievement Awards today.

Annual Achievement Awards nominations are open until August 15. Winners will be announced from stage in Washington DC on September 30th. All uses of blockchain technology are eligible.

Source: Plato Data Intelligence

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Blockchain

Happy birthday Ethereum!

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Today marks the sixth birthday of the Ethereum network and Ether – the world’s second-largest digital asset.

Ethereum was created by the crypto innovator Vitalik Buterin when the project was officially proposed in a white paper in late 2013.

The following January, a 20-year-old Buterin, headed down to the annual North American Bitcoin conference in Miami, Florida, clutching that white paper.

It’s there he met his Ethereum co-founders – a group of Canadian crypto evangelists who immediately saw the huge potential of Buterin’s idea.

Crammed into a little beach house, they invited Buterin to stay and turn his vision into reality.

Within six months, Vitalik had dropped out of the computer science program at the University of Waterloo, and moved out to Zug, Switzerland (now known as crypto valley) along with the rest of the group-turned-team.

The founding members of the Ethereum network included Gavin Wood (Solidity smart contract language creator), Anthony di Lorio (DeCentral founder), Joseph Lubin (ConsenSys founder), and Charles Hoskinson (Cardano founder).

After the completion of an $18m funding round in 2014, development begun and Ethereum slowly materialised as a viable decentralised network.

However, tensions between members set in and the team begun to unravel.

Charles Hoskinson was the first to go, many others would follow.

Today, only Buterin still works on the project.

After a period of successful testing on July 30, 2015 – the first block of Ethereum was mined and the Ethereum mainnet was launched.

The network has rapidly grown to become one of the most prominent components of DeFi and the crypto industry at large. However, a victim of its own success, gas and transaction fees have begun to slow.

This is why Ethereum is now preparing for an imminent scalability update to Ethereum 2.0.

Watch this space.

More crypto news and information

If you want to find out more information about Bitcoin or cryptocurrencies in general, then use the search box at the top of this page. Here’s an article to get you started.

As with any investment, it pays to do some homework before you part with your money. The prices of cryptocurrencies are volatile and go up and down quickly. This page is not recommending a particular currency or whether you should invest or not.

Disclaimer: The views and opinions expressed by the author should not be considered as financial advice

 

 

PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
Click here to access.

Source: https://coinrivet.com/happy-birthday-ethereum/

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Blockchain

Binance to halt derivatives and futures trading in Europe

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Binance has officially halted futures and derivatives products offerings across the European region, commencing with Germany, Italy, and the Netherlands. 

The leading cryptocurrency exchange continues to limit products to users amid the ongoing challenges it faces from global regulators.

The move means users from these countries will not be able to open new futures or derivatives products accounts “with immediate effect”. 

Binance confirmed that if existing users have any open positions in these markets, they are advised to close them, noting that a further announcement would be made at a later date to confirm a 90-day period in which to close open positions.

Binance clarified the importance of European markets to their offerings and invited regulators to open a dialogue to discuss the requirements necessary at local levels. The discussion marks Binance’s continued efforts to collaborate with local and national regulators on the necessary requirements to operate in these areas.

“The European region is a very important market for Binance, and it is taking proactive steps towards harmonising crypto regulations, which is a positive sign for the industry,” wrote Binance in a tweet.

Binance also said it does “not actively market Futures and Derivatives Products locally” and that they plan to start “further scaling down” access to these products within Europe. 

The announcement follows Binance’s recent removal of high leverage trading products from its product offerings and a seemingly relentless wave of scrutiny and oversight from global regulators. 

Despite recent efforts to appease regulators by CEO Changpeng Zhao (CZ), Binance has been forced to delist certain margin trading pairs and cease trading and support for stock tokens like Tesla and Coinbase. Binance is also preparing to cut daily withdrawal limits from two Bitcoin (BTC) to 0.06 BTC in August.

Additionally, leading banking institutions and payment processors in the UK have started to limit transfers to and from Binance, citing “excessively high fraud rates” as a key reason for the decision. 

Binance has also been banned in Malaysia and given 14 days notice to shut down its operations. According to an announcement released today, the Securities Commission of Malaysia has issued public enforcement actions against Binance for “Illegally Operating in Malaysia.”

Binance has been given 14 business days from July 26 to comply. The order demands that Binance disables its website and mobile apps in Malaysia alongside ceasing “all media and marketing activities”.

The announcement also mandated Binance CEO Changpeng Zhao to ensure full compliance with the order. Malaysia’s securities regulator also urged citizens to desist from trading with crypto exchanges operating in the country illegally.

Binance-owned exchange WazirX is also being investigated by authorities in India to determine whether it was complicit in alleged money-laundering conducted by betting apps, which collected more than $134 million in the past 10 months. The Enforcement Directorate is investigating allegations that Chinese-operated betting apps laundered a portion of funds through WazirX.

CEO Changpeng Zhao remains optimistic about the future of Binance despite the recent regulatory issues faced by the exchange. He recently disclosed that Binance US, which operates separately from Binance, was looking to go public.

“Binance US is looking at the IPO route,” he said.

“Most regulators are familiar with a certain pattern or having headquarters, having corporate structure. But we are setting up those structures to make it easier for an IPO to happen.”

 

PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
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Source: https://coinrivet.com/binance-to-halt-derivatives-and-futures-trading-in-europe/

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Blockchain

PayPal to launch crypto trading in UK

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PayPal has announced an extension of its cryptocurrency trading platform to UK customers.

This is a significant change of tune by the company, whose former CEO Bill Harris described Bitcoin in 2018 as “a useless payment system, and a ridiculous store of value”.

Now, however, the electronic payment service has slowly begun integrating cryptocurrencies on a large scale, with the moves described as part of an incremental new strategy by new CEO Dan Schulman as he revealed details in his recent Q2 reporting call.

“We continue to be really pleased with the momentum we’re seeing on crypto,” he said.

“We’re going to launch, hopefully, maybe even next month in the UK, open up trading there.”

Trading of crypto assets such as Bitcoin (BTC), Ethereum (ETH), and LiteCoin (LTC) is planned to arrive for UK users by the end of August. Currently, PayPal allows cryptocurrency transactions up to $100,000.

However, PayPal retains control of user’s cryptocurrency in a move reminiscent of traditional centralised financial practices, with no mechanism for transfers to private wallets.

This leads to the ‘not your keys, not your coins’ argument.

Jose Fernandez da Ponte, Vice-President for Blockchains, Crypto, and Digital Currencies suggested this will be a future feature incorporated into the Venmo platform.

Venmo – an easy payment app owned by PayPal – has become a primary facilitator of cryptocurrency trading for the company. The app is popular in the United States, but has made little impact on the British market.

Schulman indicated that Venmo is preferential as it can be used easily in day-to-day commerce, also noting the app’s rapid growth to 70 million users and revenues in excess of 180%.

“We’re also seeing strong adoption and trading of crypto on Venmo,” he added.

“In this quarter, we expanded the Venmo value proposition to allow merchants and consumers to pay for goods and services.”

Crypto in commerce seems to be the predominate focus of PayPal, although its ‘super app’ will operate a centralised trading exchange, this is a competitive space with the likes of DashDirect launching earlier this week.

Automated Clearing House (ACH) sits at the core of PayPal’s market-dominating strategy, allowing vendors and merchants to set-up direct debits to user’s crypto wallets.

“We’re working right now on transfers to third-party wallets, and we really want to make sure that we create a very seamless process for taxes and tax reporting,” Schulman explained.

“And so we’re really looking at how do we integrate that into both the trading and the buy with crypto on our platform.”

Implementation of DeFi products into PayPal’s ecosystem is fundamental to the firm’s potential success in integrating commerce with mass adoption, a fact that doesn’t escape their CEO.

“How can we use smart contracts more efficiently?” he asked in the Q2 call.

“How can we digitise assets and open those up to consumers that may not have had access to that before?”

“There are some interesting DeFi applications as well. And so we are working really hard.”

Needless to say, PayPal’s moves on cryptocurrency are of huge significance for crypto adoption – with the platform representing an easy and widespread point of entry for new crypto users.

More crypto news and information

If you want to find out more information about Bitcoin or cryptocurrencies in general, then use the search box at the top of this page. Here’s an article to get you started.

As with any investment, it pays to do some homework before you part with your money. The prices of cryptocurrencies are volatile and go up and down quickly. This page is not recommending a particular currency or whether you should invest or not.

Disclaimer: The views and opinions expressed by the author should not be considered as financial advice

Disclaimer: We do not give advice on financial products.

PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
Click here to access.

Source: https://coinrivet.com/paypal-to-launch-crypto-trading-in-uk/

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