Ok so I am a Technologist, economics is not my profession, but it is obvious there is a love affair happening with Physical GOLD, at times it appears almost religious. In this blog, I will not look at the economic rational for "printing" fiat money or the affect it has on nations and global commerce. I will concentrate on a Digital Currency (not virtual currency), with the utility of any existing fiat currency, but backed by physical GOLD. For the exercise we have set 1000 GLD Bits to equal one troy ounce of physical GOLD or ~ $1 USD per Bit.
GLD the digital currency alternative, with all of the utility of any Fiat Currency,While developing the Block Chain Ledger Payments Rail, for existing fiat currencies and Banks, it becomes apparent that when all ownership is codified on the Global Block Chain Ledger, one creates a global set of ledgers which model the existing fiat currency, if we take AUD for example, as the Payment system is booted, in effect a closed system is created, with the total liability of AUD across the planet appearing as a liability at the Australian Reserve bank ledger. This is the result one expects. As the total set of linked ledgers, is effectively reconciled in real-time across the Global AUD holdings, the only way new AUD can get into the system is via the Reserve Bank. The reserve bank is in effect printing the money, which becomes a national liability, or an IOU to pay the rest of the world, via some future income or national capacity. The modern fiat currencies around the world are not backed by any physical or current asset.
but backed by Physical GOLD.
Ok this is an engineers view of economics, as seen though accounting standards, so don't flame me about the fine details.
What many people, primarily the ones invested in physical GOLD or perhaps a GOLD EFT, are looking for is an alternative to these fiat currencies and the economic theory which underpins them, basically the freedom to choice which currency to utilize on a daily basis, a free market for digital currencies, where the market alone decides. This vision is not one, to replace any fiat currency but one where options exist. In our vision just like the payments rail is only available to licenced bank, we invasion a simular licensed Bullion Vault network, this is essential to achieve legal finality of settlements within the Payments Rail.
While Gold is a physical asset, it is not even close to having the utility of any fiat currency, and in many cases such as an EFT, the gold is actually a derivative and has none of the original characteristics if the gold was physically held or directly owned by the individual.
Sometime cool technologies are just cool. With the release of the Global Block Chain Payments Rail, it is now possible to offer a digital currency, lets call it GLD, which operates identically to any fait currencies, one can buy a cup of coffee, via P2P payment identical to say AUD, via any Mobile Device on the planet. All physical Gold is securely held within bullion vaults around the world, with the individual ownership of each and very gold bar codified onto the Block Chain Ledger and the GLD digital currency, via the HSM protected sets of keys.
The actual deployment of a GLD currency is a bit more complex than alluded to in this short blog, but in effect the Bank is the Bullion Vaults and all P2P payments, in what I have coined GLD bits are effected on the same Global Block Chain Payments Rail, via secure P2P payments, with full legal settlement identical to any existing currency.
The technology and infrastructure exists today, which allows a group of Bullion Vaults around the world to create "GLD" the alternative digital currency,As an "alternative" global currency, the market and each Individual will have choice, about which economic theory, they wish to support.
backed by physical GOLD.
As GLD is just another digital currency to the Global Block Chain Payments Rail, full AML/CTP, all national and international regulatory compliance, plus full legal finality of settlement obviously come with the GLD currency.
Technology is very cool,What does this mean for Bullion Exchanges and Vaults?Yes the "eureka" moment, physical Gold bars no longer need to be "moved around" any more! They still need to be keep inside a Vault and audited, except they now stay put, it makes almost no difference which licenced vault the physical vault resides, The Global Block Chain Register, codifies all GOLD with providence. The Global Block Chain Payments Rail, provides the utility of a digital GLD currency which effectively codifies and transfers ownership instantly across the plant..
when it "empowers" Individuals..
Technology is cool, when it has utility..
Only licenced bullion dealers can participate and hence crate the GLD currency, this bit stays the same, and is essential to achieve the legal finality of settlement of the GLD currency..
And, yes the payment of GLD for say a cup of coffee is actually transferring direct ownership of physical GOLD, well GLD Bits of currency, identical to any existing fiat currency, with the identical legal and regulatory framework.
Stay tunedWe are currently codifying the majority of the worlds 400 troy once bars, across the major Vaults into our Pubic Block Chain Registry ( just a refiner registry, not a currency), this will form the baseline for a future GLD digital currency.
The first refiners Gold Bar lists have been published on the Public Block Chain Register.
This Public Block Chain Register,
provides the first "immutable"
register of 400 ounce bars,
including their cryptographic
global "Asset Identifier".
The Global Gold Bar Registry is now available to any Gold Refiner.
All Public Block Chain access is free, please ask your refiner for their Secure Identity and filter on asset type "GOLDBAR 400OZ".
The World of immutable Gold Bar lists,Audited records of 243,129 * 400 troy ounce Gold Bars, from 147 Gold refiners, are now codified within the Global Block Chain Registry.
with full providence is here today.
Sample Gold Bar extract:
{"AssetId":"tkCWXFDQaaI8e2UNUg2QGcfeQPuOGBQJ8G2OwJ6ZGvY=",
"RefinerSin":"010114eae6337bc5f32e1e7d0d23cb48bXXX",
"SerialNumber":"20045230",
"Fineness":997.1,
"GrossWeight":425.700,
"RefinerCountry":Philippine's,
"ManufactureDate":null,
"LastAuditorSin":null,
"LastAuditDate":"2013-03-01T00:00:00",
"LastAuditorSignture":null,
"LastAuditReference":"doc:10370|page:11|line:12",
"Image":null,
"VeriscanCode":null
}
References
The Global Block Chain Payment Rail
The Global Block Chain Securities Settlement Rail
Additional Reading
The mystery of Banking
Banking Theory, Deposit Insurance, and Bank Regulation
Switzerland to Vote on FRB
Disclaimer The contents of this site should not be understood to be accounting, taxation or investment advice but rather as general product related educational information that may or may not meet your specific requirements.
