Welcome to the era of digital asset-backed tokens
Over the past few years, there has been an explosion in demand for cashless digital payments. Global transaction volumes have grown by 11.2% during 2014-2015 to reach 433 billion, partially fueled by Emerging Asia. In the past 24 months, this has been enhanced by the introduction of mobile contact-less payment solutions such as Apple Pay, Alipay, Google Pay, and a whole host of other innovative solutions.
Digital gold currency [DGC] – ‘gold grams’ or ‘e-gold’ – are also increasingly popular. No specific financial regulations govern DGC providers, so they operate under self-regulation. DGC providers are not banks and therefore, do not need to comply with certain bank regulations, and there are concerns that unscrupulous operators are operating in this emerging sector. Digital gold is primarily used by clients to buy gold for saving or as an investment and as electronic money among the users.
As we enter the digital age, asset-backed tokens are a better investment than physical assets. Not only is it more accessible on-ramps then buying/mining gold, but the assets are also more divided; greater liquidity. Additionally, digital asset-backed tokens can be exchanged across global markets, but as securities, they must comply with the non-static regulations of each country. As a gold-supported currency, Garnex does not have the same issues.
Similarly, the e-commerce economy is skyrocketing at a phenomenal rate. It is estimated that by 2020, the crypto economy will exceed three trillion dollars and that by 2023, it could be equal to 10% of world GDP. Only time will tell whether or not these predictions are accurate, but what is certain is that cryptocurrencies have passed their point of no return. They are here to stay, and their importance will only soar.
Gold’s relative scarcity, its mobility [you can carry small bars, coins, or jewelry] and its high demand in industrial applications all make it a highly desired commodity.
Cryptocurrency has adopted some of the advantages of gold with the creation of Bitcoin: through the introduction of a digital coin that can be quickly and effortlessly transmitted and by the nature of a distributed blockchain which will ease the flow of commerce. The technology empowering cryptocurrencies plays the driving force for fast, secure, and transparent transactions.
Even those with a keen interest in new technology and superior ways of conducting transactions, gold is still perceived as a stable and reliable investment instrument. The most critical step in moving benefits from the conceptual into the practical mainstream is to empower people to use gold in the same way as they can with any other currencies. This would mean the enablement of instant payments using Gold currency as though it were just cash or money.
We have mentioned how virtual currency could bring value to the everyday lives of many people. As a result and solution to our deliberation, we focused on gold, a precious metal used in daily lives, with its value recognized worldwide as a monetary and property asset.
Digital gold currency is a form of representative money as it directly represents gold metal on deposit or in custody. This depends on the issuer. Most issuers have the gold on deposit – i.e., the issuer will redeem the digital currency obligation with tangible metal. Just as the exchange rates of national currencies fluctuate against each other, the exchange rates of Garnex fluctuate against national currencies, which is reflected by the price of gold in a particular currency. This creates exchange risk for any individual account holder, in the same way one would experience exchange risk by holding a bank account in a foreign currency.
Garnex is currently running a giveaway campaign where the winner has the chance to receive 1 ounce of gold [worth approx. $1500 USD]. To learn more about GLD currency and how Garnex is creating a gold standard for the digital economy, then check out their website here.
Disclaimer: AMBCrypto does not endorse or support any product or project mentioned on this page. Articles in this category could be sponsored in nature. Readers are advised to do their due diligence before making any financial decisions.