Puregold is an established gold business that has moved into cryptocurrency. It claims to be the first Payment Gateway for people to exchange gold as digitized asset. So, how did they get to this position?
Puregold has been a private mint based in Singapore and operating since 2010, selling value added silver and gold coins and bars. It had already established itself as a business of credibility, winning the Asia Pacific Top Excellent Brand in 2011. It mints real gold, storing it in an audited cold storage safe vault. Puregold has shops and offices across Asia and was show cased in the 2013 Singapore Visitor Centre. It began to experiment with novel ways of promoting gold and in 2017 it opened Asia’s first Gold ATM machines dispensing real gold.
Asia, and indeed the rest of the world, enjoys a positive relationship with gold. It is recognised as an asset that cannot be diluted, reduced and destroyed. There is also only a limited amount in the world. Since Byzantine times gold was valued as the reserve value that unpins a sovereign or nationstate currency. For most of the 20th century, the world’s currencies were backed by gold. This meant that countries were unable to print more of their currency than they had reserves of gold in the bank. President Nixon decoupled the federal reserve from the gold standard in 1971 with other countries following suit. Now fiat producers can print money without regard for underlying value.
Termed quantative easing, the process of printing more money is used to maintain inflation. This can have a negative impact on the value of currency, does not always maintain low inflation but it does have the direct impact of increasing the value of gold. In 2011, for example the price of gold soared to $1,500 per gram as a direct result of worried investors reacting to fiat quantative easing.
At the same time, it is also predicted that value of cryptocurreny will rise to $3trillion in 2020 and by 2022 it will account for 10% of the global world GDP.
Puregold reacted to these changes by first introducing bullioncurrencies.com in the same year 2017. This was a soft launch of the new gold backed token PPG this January just gone. It was marketed as the first token backed by gold, real gold, held in a secure vault.
In addition, Puregold launched a second token PGT which was to be used on the Puregold platform for the payment of transactions.
Already there is considerable interest in this project, always a positive to see tokens back by real assets. In its promotion video investors all claim the ‘backed by gold’ is key for them. The Pre ICO finished on the sixth of January while the main ICO finished on March 14th with over two thirds of the hard cap reached.
The target market for these tokens are a mixture of cryptocurrency traders that wish to use PGG tokens as a guard against cryptocurrency volatility as well as standard participants wanting to swap other cryptocurrencies such as ETH for PGT as a diversification in their portfolio of coins.
The success of the PGG digitised gold tokens lies in the 100% transparency of all their stored gold. The Puregold platform is based on Ethererum allowing for smart contracts between traders and investors. In addition, the Puregold platform differentiates itself from other gold cryptocurrency blockchains through the inclusion of the first Payment Gateway using PGG. The physical gold backing the PGG tokens is stored in a storage unit which is managed by a third party, separately audited security firm engaged to identify and store investment grade gold, jewellery, small ingots and coins.
It is this physical backing that ultimately encourages the Puregold investors.