One Is Blockchain And The Other Gold

Gold Coin of Croesus, ca. 550BC

Gold Coin of Croesus, ca. 550BC

Gold + Blockchain?

My prior blog concluded:

To paraphrase an old Girl Scout campfire song:

Make new friends,
But keep the old.
One is blockchain,
And the other, gold.

Intrigued?

Well, since here you are, apparently again, I hope so.

Most people kind of “get” gold.  As noted before, it’s “unbelievably beautiful.” 

It holds its value.

It will last thousands of years.
Another way to say that? 

Immutable.

Gold is as close to immutable as anything can be.

So too, as it happens, the blockchain is immutable.

“Blockchain” may be the hottest buzzword in tech right now. Fortune Magazine put it on its cover as “Blockchain Mania” with a story headlined Why Big Business Is Racing to Build Blockchains. Stories about this are everywhere.

Luckily you don’t have to race.
Gold-on-blockchain has been built for you.

Is this a big deal?

Billionaire venture capitalist Marc Andreessen, inventor of the Web browser, said to the Washington Post:

’This is the big breakthrough. This is the thing we've been waiting for. He solved all the problems. Whoever he is should get the Nobel prize -- he's a genius. This is the thing! This is the distributed trust network that the Internet always needed and never had.’" … So the business opportunity posed by this "distributed trust network" — as an investor, what do you see that you could potentially — “Hundreds or thousands of applications and companies that could get built on top. Is this, like, a billions-of-dollars kind of industry? “Yeah.” Trillions…? “Yeah!”

Gold, as money, is one of the oldest “technologies.” Money is a form -- as a unit of account, like the inch or the ounce, the most basic form -- of economic technology.

Gold has served as money — as much a technology as fire or the wheel — for thousands of years.

Historical records go back to the Lydians. Numismatic historians credit Lydia with the first official coinage. (Lydia was in what is now modern-day Turkey).

You may not have heard of Lydia. But you may well have heard of one of its kings. That king, about 2,500 years ago, was so rich (thanks, in part, to his invention of gold coinage) that his name became synonymous with wealth:

“Rich as Croesus.”

Per Wikipedia:

Croesus is credited with issuing the first true gold coins with a standardized purity for general circulation. However, they were quite crude, and were made of electrum, a naturally occurring pale yellow alloy of gold and silver.

In Greek and Persian cultures the name of Croesus became a synonym for a wealthy man. Croesus' wealth remained proverbial beyond classical antiquity: in English, expressions such as "rich as Croesus" or "richer than Croesus" are used to indicate great wealth to this day.

To embellish the story a bit further, per ancient.eu:

His wealth, it is said, came from the sands of the River Pactolus in which the legendary King Midas washed his hands to rid himself of the 'Midas Touch' (which turned everything he laid hands on into gold) and in so doing, the legend says, made the sands of the river rich with gold.

Conjoin that oldest-of-technologies, gold-as-money, with one of the newest, the blockchain, to create an amazing synergy. It combines the best of the old and the new worlds.

Gold is heavy, (relatively) unchanging in value (as measured by goods and services), and so valuable that it is difficult to spend on an everyday basis. An ounce of gold is worth, today, about $1,280. Imagine taking that into the grocery store and buying a pack of gum and receiving change.

The smallest unit of physical gold is called a grain. At today’s price it’s worth $2.67. But there’s another problem.  A grain is tiny! One gram is well smaller than a dime. And there are about 15 grains in a gram. Too tiny to be practical.

Gold is too precious to serve as a medium of exchange in daily life, or is it?

The blockchain, a form of computer code, is weightless, volatile and by itself has no intrinsic value and can be “spent” with a click on your cellphone.

Conjoin gold with the blockchain and: Problem solved!

Desire to own some gold?

Here are some important factors in choosing how.

First, it is crucial that you truly own the gold, not just a claim on gold technically owned by a third party. If all you have is a claim — such as by electronic transfer of funds (ETF) — and the holding company goes under, you lose your gold and all, or most, of its value as an unsecured creditor in bankruptcy proceedings.

Emergent Technology through its Responsible Gold™ operation has that handled. The title to your gold-on-the-blockchain is registered in your name. It is securely yours with a digital title to ownership and not owned by any third party.

Yours.

Second, your gold must be securely stored. Nobody wishes to wake up to on the morning news of a “Great Gold Robbery” … with your gold having been carted off by masked desperadoes.

Responsible Gold™ has that handled too. Responsible Gold™ uses blockchain technology, tamper-proof seals, RFID and geolocation chip technologies to track gold ownership, title transfer, physical location and custodial liability on the blockchain. This adds an additional layer of information to ensure vaulted gold in the Responsible Gold ecosystem is 100 percent conflict free. And, unlike a lot of digital coins, lose your wallet key… no problem, Responsible Gold is there to help you out.

Third, if you are an ethical person you will wish your conscience to be serene that your gold is ethical. No exploitation of miners or refiners. No ecological destruction. No shady dealings.

All gold has similar physical properties. Not all gold is extracted and refined in clean ways. 

The gold you buy and hold with Responsible Gold™ is clean.

The meticulous requirements Responsible Gold places on its supply chain through World Gold Council (WGC) and London Bullion Market Association (LBMA) standards is documented on the blockchain and thus the gold you can own there is the moral equivalent of “conflict-free diamonds.”

Lastly, for now, it is wise when buying gold to do so in in a way that also, when you wish, makes it easy for you to sell it conveniently and without undue expense.

Sourced through Responsible Gold™, G-Coins™ provide organizations and individuals a no cost option for wealth transfer versus traditional options that can take days at a cost of 3-to-4 percent of the transaction amount. Many retailers, such as Overstock.com, already accept payment in bitcoin, but G-Coins™ will make transactions auditable and more secure for users and retailers because of the Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations that are in place.

You don’t need to know the technology to use it any more than you need to know computer code to send an email or browse the Web. Yet for my “curious” readers, what, exactly, is this thing called the “blockchain?”

Simply put, the blockchain is a chain of “data blocks,” each block holding information about a transaction that, when confirmed, gets copied, identically, into the memory of thousands of computers all the way to the first, or “genesis,” block.

Because the blockchain is distributed it cannot be hacked or tampered with.

This makes it immutable.

Like gold.

The blockchain’s unique properties are creating a revolution in tech. They open a new, secure, high- tech, convenient and inexpensive way for regular people to buy, hold and sell gold.

Back to our adaptation of the Girl Scout campfire song:

Make new friends,
But keep the old.
One is blockchain,
And the other gold.

Welcome to your old friend: gold.
And your new friend: the blockchain.

Welcome to gold-on-the-blockchain.
Welcome to Responsible Gold.

Ralph J. Benko