Gold-backed cryptocurrency aims to entice investors back to precious metals

Australia’s biggest precious metal refinery, Perth Mint, is developing its own cryptocurrency backed by physical commodities like gold. It expects to bring investors back to the traditional market of precious metals.

According to CEO Richard Hayes, the mint wants to provide a transparent offering that would allow investors to buy and sell with confidence, knowing that what they are buying is completely traceable. 

Perth Mint has an online trading platform where traders can buy and sell precious metals around the clock.

“I think as the world moves through times of increasing uncertainty, you’re seeing people look for alternate offerings,” Hayes said, adding: “With a crypto-gold or a crypto-precious metals offering, what you will see is that gold is actually backing it.”

“So it will have all the benefits of something that is on a distributed ledger that settles very, very quickly, that is easy to trade, but is actually backed by precious metals, so there is actually something behind it, something backing it.”

The company plans to use blockchain technology, which will make it easier for consumers to buy gold. Blockchain will provide more transparency in the system and will also make it more secure, Hayes said, calling it a “cutting-edge technology.”

“There’s nothing in terms of cryptocurrencies that actually back the currencies. If you use precious metals to back something on blockchain or something that is allied to blockchain, it retains its intrinsic value, unlike the offerings from bitcoin and ethereum, which really rely on everyone believing that there’s something behind it,” he said.

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