Gold and blockchain: Precious Metal Disruptor [INFOGRAPHIC]
Gold is currently the top precious metal in the precious metal category (by its current price, that is). Gold has a long and rich history of being recognized as a store of value, and a sign of power. This shiny yellow metal has also more recently been seen as a long time favorite among investors, for its price stability and hedging aspects against fiat currency (mainly the US dollar) — gold usually goes up in price in uncertain economic times. Gold has a long history of being used by governments as actual money, and more recently as a form of national reserves. And gold also has incredible intrinsic value. Gold is very resistant to corrosion, an excellent conductor of electricity, it shields from radiation, and it’s ridiculously malleable. Because of these characteristics (and others) of this physical commodity, gold has a number of uses, from jewelry, to electronics, to health, to space equipment, and more. And, on top of all this, gold is a rare resource.
Blockchain on the other hand is quite different. It has only come about in the last few years, it is strictly a digital technology (in an increasingly digital society), it is endlessly reproducible, and in of itself it has no intrinsic value; However, blockchain does have seemingly endless possibilities for new and useful applications. A blockchain is supposed to be decentralized, it is a distributed ledger, which is a record of transactions, which is distributed among a network of computers. Blockchains help offer transparency and efficiency — they are the underlying technology that makes cryptocurrencies possible. And, thanks to new blockchain technology, called Smart Contracts (originally invented by Ethereum) physical assets and commodities can now become tokenized on a blockchain — meaning that a cryptocurrency can now be pegged to the value of a real world asset. This is important, because from what the world has seen thus far, traditional cryptocurrencies’ prices are extremely volatile.
Enter gold-based cryptocurrencies, and the star of our infographic: DinarCoin. Smart contracts allow for us to create tokens which are either backed by particular pieces of gold bullion or which are simply pegged to the worldwide gold spot price, as is the case with our DinarCoins (DNC). By combining gold and blockchain in such a way, you gain most of the benefits of both gold and cryptocurrencies (such as: price stability, hedging abilities, price appreciation, as well as speed and flexibility), and also lose most of the setbacks (such as: extra fees for shipping, insurance, and storage, difficulty in carrying and spending, as well as a lack of intrinsic value, and having extremely volatile prices).
Enjoy the infographic below, Have a wonderful day, The DinarCoin team.
