Perth Mint, Australia’s biggest gold, silver and platinum refiner recently announced that it plans to develop a cryptocurrency that is made with real gold.
If the refiner succeeds, it will be the latest in the long list of companies attempting to lure cryptocurrency investors to experiment with commodity backed virtual currencies.
Richard Hayes, the chief executive of Perth Mint speaking to the Australian Broadcasting Corporation (ABC) said that the firm has seen a notable opportunity in “bringing investors back to precious metal after a boom in alternate investments such as cryptocurrencies.”
Hayes further observed that “I think as the world moves through times of increasing uncertainty, you’re seeing people look for alternate offerings.” He also went on to add “and you’re seeing this massive flow of funds into the likes of Bitcoin at the moment because people are looking for something outside of the traditional investments.”
Mr. Hayes says “with a crypto-gold or 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.”
In 2017, a similar idea was launched by OneGram, a Dubai-based company that offered a Sharia compliant digital currency backed by gold, the first of its kind. The Initial Coin Offering (ICO) for the gold backed cryptocurrency got a lot of international media attention for what the firm thought would generate more than $500 million token sale.
However, by the end of the first phase of the ICO, the company only sold 16,926 OneGramCoins (OGC) out of 12,400,786 that the company had planned to sell, representing a dismal 0.14 per cent of what the company initially anticipated.
Venezuela is another country that has recently made public its plans to launch a commodity backed cryptocurrency called ‘Petro’. The government there says that its cryptocurrency will be backed by 5 billion barrels of Venezuelan crude oil. It expects to start selling by February, 15th, 2018.