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Commodities - SEPTEMBER 5, 2019

Firm launches blockchain for gold

by Released

Paxos Trust Co. has launched PAX Gold (Ethereum ticker: PAXG), the first crypto-asset redeemable for physical gold. The New York State Department of Financial Services (NYDFS) has approved Paxos to issue PAX Gold, making PAX Gold the first regulated digital gold product.

PAX Gold is an asset-backed digital token, each representing one fine troy ounce of London Good Delivery gold stored in professional vault facilities in London. PAX Gold customers own the underlying physical gold, while also benefiting from the speed and mobility of a digital asset. Because PAX Gold represents physical gold, its value is tied directly to the real-time market value of gold. PAX Gold is built as an Ethereum token, following the ERC-20 protocol, so that it is easy to integrate with exchanges, wallets, lending platforms and other crypto products. Rather than the usual storage fees that come with gold bars, Paxos charges negligible fees for on-chain transactions and at the point of token creation or destruction on Paxos.com.

Charles Cascarilla, CEO and co-founder of Paxos, stated, “In a digital and global financial system, owning physical gold is a cumbersome, outdated investment; it’s not easy to trade, divide, move or leverage against other investments. While it’s easy to trade gold derivatives — ETFs, futures and unallocated gold — these are synthetic representations, not legal ownership of physical gold, and have limited accessibility. Gold purchased through unaccredited retail outlets is not only expensive, but also risky as the quality and provenance of the gold are unverified.”

Cascarilla continued, “PAX Gold solves these fundamental challenges. It’s as easy to trade as ETFs or bitcoin, is extremely mobile and divisible, and it also gives holders ownership to the highest quality gold in the world. It’s never been easier to own or trade gold, and we are thrilled to give both institutions and individuals access to gold in a faster and cheaper way. By putting gold on a blockchain, we’re democratizing access to gold.”

 

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