Cryptocurrency Backed By Gold Planned By Australia’s Perth Mint

Announcements, Blockchain, News | January 24, 2018 By:

The Perth Mint, Australia’s biggest gold refiner, is planning to develop its own gold-backed cryptocurrency in a bid to lure consumers back to investing in gold.

The Perth Mint is Australia’s official bullion mint and wholly owned by the Government of Western Australia. It is responsible for manufacturing and marketing most of Australia’s legal tender precious metal coins. It stands up as one of Australia’s largest exporters, distributing around $18 billion in pure gold, silver, and platinum bars and coins to investors in more than 100 countries.

The company said it is in the process of developing a yet-unnamed cryptocurrency backed by gold that would also be used for buying and selling crypto-gold on a blockchain. The goal is to provide a transparent offering that would allow investors to buy and sell with confidence, knowing the products they were buying were completely traceable.

Perth Minth chief executive Richard Hayes said the need to bring investors back to precious metals after a boom in alternative investments such as cryptocurrencies posed an opportunity.

“I think as the world moves through times of increasing uncertainty, you’re seeing people look for alternate offerings,” he said. “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.”

Hayes said the volatility of bitcoin and other cryptocurrencies meant they did not suit all investors. With a gold-backed cryptocurrency, what investors will see is that gold is actually backing it.

“There are a number of offerings out there that use standard blockchain as the underlying record-keeping system, but many of those are not actually gold-backed, so you’re relying on the actual blockchain technology itself, said Hayes. “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.”

Hayes added that the company is also interested in implementing blockchain technology into its own operators. A possible application could see the entire supply chain of gold bullion traced from the mining site through to its sale to a consumer – traced and logged in an immutable, transparent blockchain.