Banks, large corporates, financial institutions and wealth management companies can eliminate their currency holding and gold reserve hedging risks through the digital gold currency backed by gold.
Last week, US Gold Currency Inc and Blockfills of the US, and UAE-based financial consultancy IBMC Financial Professionals Group announced the launch of the world’s first gold-backed digital gold currency in the Middle East.
US Gold Currency is the issuer of the USG digital currency and Blockfills is the provider of digital asset liquidity. The digital assets are issued and administered via a smart contract on Ethereum blockchain platform.
“We have seen significant demand for gold and USG is an innovative and unique digital currency backed by the American Eagle one-ounce gold coin. Today’s global economic climate has further increased that demand at the institutional and retail levels,” said Sheikh Khalid Bin Ahmed Al Hamed, chairman, IBMC Financial Professionals Group.
The company’s CEO and Managing Director Sajith Kumar PK said the introduction of the digital gold currency has opened a window for banks, large corporate, financial institutions and wealth management companies in the Middle East, Africa and India to eliminate their currency holding and gold reserve hedging risks.
“Wealth management companies can take it as a stable currency for their gold investments. Those who are holding physical gold in vaults can convert their holding into digital currency and jewelers, instead of pledging their physical gold, can use the digital assets for pledging or as lien,” he said.
USG is Blockchain security verified currency by the authority CertiK, USA, partnering with IBM and Ethereum Foundation, which ensures the credibility and security of USG,” said Mike Pearson, Vice President, Blockfills.
The statement said the holders of USG can redeem their digital assets as physical gold coin or in US dollars anywhere in the world. Every American Eagle one-ounce gold coin backing a USG token is stored in a fully insured, secure vault, and audited annually by an independent third-party auditing firm.
Token holders can also sell the USG on the open market through various digital asset exchanges or through Blockfills in exchange for US Dollars.
The US government division, the US Mint, sets the price of the underlying physical gold coin once per week, on Wednesdays. USG pricing follows this publicly available government set price.
(Writing by Bhaskar Raj; Editing by Anoop Menon)
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