Today I opened my Trust wallet app. I have a bunch of tokens held on it as a hot wallet, from Ether $ETH, Binance Coin $BNB and CanYaCoin $CAN.
Recently I had used Bancor’s dApp in Trust to swap some Ether into the DAI stable coin. The swap was seamless and very fast. Bancor’s continuous liquidity contracts are useable and very effective. Since then I had been holding some DAI $USD stablecoin in my Trust App. MakerDAO have successfully created a useable stablecoin pegged to USD.
I’m also excited that Trust plan on integrating many more blockchains and tokens, such as Bitcoin, especially now after their recent acquisition by Binance.
Scanning through the dApp browser built into Trust I saw the Kyber Network dApp. I’m a big fan of Kyber, having had $KNC since their ICO and hanging out with the Kyber team a bunch of times at conferences around the world. I am really aligned with their shared vision of decentralised liquidity.
I spotted the DGX Gold Token. Digix Global is a team based out of Singapore that have been building a tokenised version of Gold.
It has only been live since May, but so far it is has been so succesful that 1 DGX token (representing 1 gram of gold) is actually priced *higher* than the physical asset.
Check it out:
Digix have worked very hard to build trust into their asset tokenisation process so that there is no doubt that 1 DGX = 1 Gram of gold. If there was no trust in this, then 1 DGX would not be worth as much as the real asset.
The transfer and demurrage fees of 0.6% are built into the token trustlessly so holders do not need to concern themselves with anything whilst they hold the token. The gold bars are vaulted in Singapore and users can redeem their gold (minimum 100g) at any time.
I fired up the Kyber dApp and decided to swap some of my DAI into DGX. With a single transaction and less than 30 seconds I had swapped my DAI into DGX.
This token is actually now more useful than acquiring and storing real gold:
- It’s trustless. I can see the provenance of the gold token from start to finish.
- It’s fungible. My DGX tokens are all the same.
- It’s self sovereign. I hold my gold, and nobody knows. I used a DEX to acquire DAI and I used Kyber to acquire DGX. There was no KYC. There was no signup, no handing out of personal information.
- It’s decentralised. The asset is secured by Ethereum and I can redeem it in three different places around the world (more to come).
- It’s portable and useable. 18 decimal places, minimum purchases of less than $1, secured by my private key.
I now have my first ever Gold Asset and it was a seamless and magical experience. I bought tokenised gold anonymously with tokenised USD, which I also purchased anonymously with Ethereum.
I am happy to report that the CanYa team is working with the Digix team to integrate DGX into the CANWork and CANSeek platforms to allow our users to get paid in gold with the DGX token. For many this will be ground-breaking; they can get paid in gold by working on the CanYa platform. We haven’t seen this since thousands of years.
We are also looking at using the DGX token in our hedge to provide trustless underwriting of assets held in the CanYa escrow. Exciting things to come.
There can no be no doubt that the tokenised future is here. The generation ahead of me may never own real assets. They will only own tokenised assets.
I also believe that world’s economy is going to soon(ish) return to the Gold Standard, and Austrian economics of free self-sovereign markets. The world’s economy was bebased from the Gold Standard over 60 years ago. Inflation from endlessly printed fiat currencies may have helped stimulate our economy and recover from wars, but it has lead to massive wealth distribution disparities and unstable economies. Let’s not get started on all the fiat currencies that have hyper-inflated as well.
The notion that “men with guns” enforce monetary value is simply stupid and archaic. Strong economies shouldn’t need militaries. They should be strong because they create real value, not psuedo value. If you look at the US Debt clock ($21tn), you have to wonder what will ultimately happen. The US can’t keep printing USD and racking up debt forever.
Tokens like DGX will help us get back to the Gold Standard faster. There is roughly 1.6% annual inflation of Gold each year (3150 metic tonnes per annum produced each year) and the ideal inflation rate is 1-2%. There’s nothing wrong with the Gold Standard; ideal inflation, provable, fungible. Tokenised gold solves all the problems of using gold as a currency as well. The only problem with the Gold Standard is there is not enough of it to cover M1, M2, M3 and M4 money supply. We’ll need something else. Tokenised silver? Tokenised property?
I have a more aggressive and liberal opinion that we will also ultimately transition to the Bitcoin standard once it is more widely adopted and less volatile; mainly for the reason that there is practically an unlimited amount of Gold in our oceans, ground and throughout our galaxy (think asteroids). The first corporation or government to mine an asteroid for gold will cause huge dilution of gold.
Instead, Bitcoin is the only finite asset class and has transparent monetary policy with known inflation rates (currently 3.9%). But I’ll leave my thoughts to another post some time 😜
