Bitcoin has been heralded as a form of ‘digital gold’ since it emerged in 2009.
In the last few years, there has been a surge of cryptocurrencies attempting to mesh the digital world with physical gold bullion.
Gold-backed stablecoins have only grown more popular in 2020. Economic turmoil due to COVID-19 has drawn investors towards assets that can serve as a stable hedge against volatility and a store of value.
Cryptocurrencies backed by gold have also been bolstered by weakening interest rates and national currencies across the last couple years. This has been combined with clearer guidelines from authorities about the status of cryptocurrencies and non-security tokens.
Cryptocurrency backed by gold has attracted particular interest across Africa. Physical gold has increased in value by an average of 15% per year since 1971, even as most African fiat currencies depreciate.
Some projects look to harness the continent’s vast gold reserves to provide opportunities to digital purchase bullion.
There are a number of gold-backed cryptocurrencies available for investors. One option is GoldCoin.com, an ERC-20 backed coin built on the Ethereum network.
The GoldCoin creators herald their offering as the “first fractionalized gold-backed asset available for purchase directly in national currencies or cryptocurrency.”
Keep reading to understand the basic elements of GoldCoin and see if the cryptocurrency is a good investment based on your needs and desires.
Each GoldCoin is worth 1/1000 of an ounce of 99.9% pure gold that is fully redeemable. The GoldCoin team believes investors have a powerful opportunity to utilize gold as a fully functional currency while still having access to the physical asset.
Functional & Advanced Technology
GoldCoin is built on Ethereum, one of the most well-known, stable, and functional platforms for building cryptocurrencies on. This lends a large amount of legitimacy to the entire project as the smart contract address for GoldCoin is easily able to be viewed on Etherscan.
GoldCoin.com also features information about compatible wallets and provides details about recommended Gas limits. Projects built on a strong foundation often attract more investors, boosting the value of the underlying cryptocurrency and fostering long-term stability.
Clear Security Measures
One of the biggest concerns with stablecoins is the lack of actual physical assets to back up the digital currency. Stories about Tether’s purported lack of USD reserves made headlines across the globe and resulted in a large amount of bad publicity for the digital currency community.
Fraudulent gold has been inserted into global markets over the past several years to help with laundering smuggled or illicitly-mined bullion.
The GoldCoin team alleviates concerns about a lack of verified physical reserves through a variety of steps. Audit reports of the gold holdings and a 24/7 live stream of the bullion vault are accessible on the project’s website.
Audits are conducted by GDA Capital, a prominent financial institution that has worked with a range of well-known clients.
Users are also asked to perform two-factor authentication upon login to reduce the risk of malicious activity. The steps by the GoldCoin team to provide a live stream and verifiable audits place the project above many others in the sphere who are evasive about the number of physical gold reserves on hand to back up digital coins.
A Vision For The Future
The GoldCoin team has a clear vision for their project and has outlined a development plan that spans through half of 2021 on its website. While COVID-19 has certainly forced many projects to adapt and adjust plans, it is a good sign for GoldCoin its development team is still planning on expanding features and capabilities.
For Q4 2020, the team intends to onboard the first ATM networks to offer GoldCoin to the public.
Q1 2021 hopes to bring the addition of the coin to a premier marketplace for commodity-backed stablecoins. Both of these goals are achievable and realistic, a good sign for the future viability of the project.
Is GoldCoin The Right Choice?
It is clear the GoldCoin team has a concise vision and plan for the cryptocurrency. The project’s emphasis on security, transparency, and authenticity appears to make GoldCoin a legitimate investment.