Investors on the fence between investing in gold and cryptocurrency can easily allocate funds to both. One option is by setting up different portfolios. Another option is to explore gold-backed cryptocurrencies and digital currencies.
Tether Gold (XAUT)
People familiar with the cryptocurrency industry will know Tether as the issuer of USDT, a stablecoin. However, the company recently launched Tether Gold, or XAUT. It is a gold-backed token issued on the blockchain and issued by TG Commodities Ltd. Every XAUT token represents 1 troy ounce of gold on one London Good Delivery bar of gold.
All of the gold reserves associated with this project are stored in Swiss vaults. Token holders can verify serial numbers of their gold bars, or request physical gold delivery to a location of their choice. It is not the most popular asset yet, but the project seems to be gaining a lot of recognition. Most of these gold-backed digital currencies take a while to properly hit their stride.
Perth Mint Gold Token (PMGT)
Considering how the Perth Mint issues physical gold bars and coins, it is no surprise to see it getting involved in digital currencies as well. PMGT is widely considered to be a top gold-backed cryptocurrency token. All assets are backed by gold blocks belonging to Perth Mint.
Through the GoldPass app, owners of the token can obtain digital gold certificates associated with their holdings. Certificates can be redeemed for PMGT tokens, which can be traded on multiple platforms. Similar to XAUT, PMGT holdings can be redeemed for physical gold. Having this option is crucial for investors around the world.
One of the “oldest” blockchain-based tokenization efforts for gold is organized by DigixGlobal. Based out of Singapore, the tokens represent 1 gram of gold, stored in vaults in both Singapore and Canada. All holdings are insured by the Bullion Association to provide investors with peace of mind.
While these digital currencies can be converted to physical gold as well, there is a service fee for doing so. Despite a lot of initial promise, DGX never managed to find its groove. The project is still around, but struggles to achieveg sufficient traction to disrupt the overarching industry. Given the current demand for gold as an investment, that may change.
Universal Gold (UPXAU)
Uphold, a popular cryptocurrency exchange, has recently entered the world of gold-backed digital currencies. its token goes by the name of Universal Gold, or UPXAU. The main purpose of this asset is to let investors determine how much they want to invest. With as little as $1, users can obtain a fraction of gold to diversify their portfolio.
By obtaining this asset, Uphold will waive any custody fees associated with the gold. Additionally, the UPXAU asset works as a payment method for the Uphold debit card. This makes the spending of gold a lot more straightforward, as that can sometimes be a complex procedure. An extra benefit is how it is possible to convert UPXAU to physical gold held by the Perth Mint.