Gold & Blockchain — The Perfect Combination

Security tokens backed by precious metals are the ideal solution in times of economic uncertainty.

MetalStream
Nov 2 · 4 min read

The world is experiencing unprecedented economic instability due to the global lockdown and the situation is expected to deteriorate before it improves. During times of crisis, investors look to move their equity into safe-haven assets such as gold, but now we also have cryptocurrencies. A new class of investor is emerging that is looking to harness the benefits of digital currencies but maintain access to precious metals. Security tokens which are backed by and redeemable for gold are bridging the gap between the two.

The current economic crisis was precipitated by the global lockdown but its roots lie in the fiat monetary system and the Global Financial Crisis of 2008. In recent articles, we covered announcements such as the World Economic Forum calling for a Great Reset and the International Monetary Fund touting a new Bretton Woods moment. Such statements from the world’s most powerful economic interests indicate their intention to implement economic changes that will have global impacts. Investors are worried about how to secure their financial future in the face of these impending and opaque changes.

Image for post
Image for post

Gold has been used as a store of economic value for millennia. The oldest coin in history was minted 2,700 years ago and consists of electrum, an alloy of gold and silver. Gold has maintained its value over the ages because it is relatively scarce, is difficult to mine and has numerous uses in technology, medicine and art. It has proven to be a solid hedge against inflation and has always been viewed as a safe-haven asset in times of economic uncertainty.

G Edward Griffin pointed out in The Creature From Jekyll Island that in Roman times the cost of a toga, leather belt and sandals was around one ounce of gold, while today a nice suit, leather belt and shoes cost about the same in physical gold. This fact demonstrates how well gold has maintained its value throughout the ages. The discrepancy in dollar terms is explained because the cost of sweat equity has remained unchanged over time but our fiat money has been inflated. As we have discussed before, inflation should be viewed as a hidden tax by the private banks who print our fiat money.

Today many investors view cryptocurrencies as investments which can also be used to hedge against inflation. Bitcoin and other cryptocurrencies appear to have a strong attraction for young investors and embody a different value proposition than precious metals. Bitcoin appeared in 2011 as a direct response to the Global Financial Crisis and like gold, it is relatively scarce and acts as a universal unit of exchange. However, cryptocurrencies embody intrinsic differences that some investors see as advantageous. Cryptocurrencies are easy to store and can be swiftly transferred around the globe. They are inherently more liquid than physical metals and can be used to purchase a plethora of goods and services.

Image for post
Image for post

We are now witnessing the emergence of a new form of asset class that bridges the gap between precious metals and cryptocurrencies. Products such as MSGLD are delivering the proven value of gold combined with the convenience of digital tokens. Security tokens are cryptographically secured representations of an asset and in MSGLD’s case, they represent 1 gram of LBMA certified gold. Security tokens are intrinsically more secure than cryptocurrencies because in the event of loss or theft they can be returned to their rightful owners. Like cryptocurrencies, security tokens can be easily stored and continuously traded around the world.

We find ourselves in a time of great economic uncertainty. Some of the world’s most powerful financial interests are calling for economic change but how it will be implemented is yet to be revealed. A Swiss study in 2011 showed that 737 transnational corporations owned 80% of our global economy. When the wealthiest 50 Americans are worth as much as the poorest 165 million it is no secret that our institutions are being directed for the benefit of a tiny financial elite.

To secure our financial future we need to transfer our fiat currency savings into asset classes outside the changes being planned by the world’s powerful economic interests. Gold and cryptocurrency have both proven to be resilient in the face of fiat currency inflation and economic manipulation. One is ancient and the other modern. Security tokens that are backed by and redeemable for gold bridge the gap between the two, offering us the best of both worlds. Products such as MSGLD deliver us the convenience and safety of security tokens but ensure physical access to the proven value of gold.

MetalStream is the issuer of the innovative gold-backed MSGLD token. Please visit our website for more information, and contact support@metalstream.io for enquiries related to the purchase of tokens.

MetalStream

Written by

MetalStream Gold (MSGLD) tokens are gold-backed, ERC-1400 compliant security tokens employing a metal stream financing model.

MetalStream

Issuer of the innovative MSGLD security token, backed by and redeemable for bullion. Get the liquidity of a token, plus the safety and value of gold.

MetalStream

Written by

MetalStream Gold (MSGLD) tokens are gold-backed, ERC-1400 compliant security tokens employing a metal stream financing model.

MetalStream

Issuer of the innovative MSGLD security token, backed by and redeemable for bullion. Get the liquidity of a token, plus the safety and value of gold.

Medium is an open platform where 170 million readers come to find insightful and dynamic thinking. Here, expert and undiscovered voices alike dive into the heart of any topic and bring new ideas to the surface. Learn more

Follow the writers, publications, and topics that matter to you, and you’ll see them on your homepage and in your inbox. Explore

If you have a story to tell, knowledge to share, or a perspective to offer — welcome home. It’s easy and free to post your thinking on any topic. Write on Medium

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store