As global demand for gold remains robust and prices reach all-time highs, investors face a myriad of options for gold investment. Traditional investment methods often come with significant drawbacks: physical gold incurs substantial buy and sell fees, gold futures necessitate advanced financial acumen, and gold-backed cryptocurrencies frequently suffer from unreliable reserve audits or opaque gold sourcing.
IPMB: Bridging Gold and Cryptocurrency
The International Precious Metals Bullion Group (IPMB) offers a fresh approach to gold investing by leveraging its extensive experience in the gold industry alongside the innovative capabilities of blockchain technology. By controlling critical steps within the supply chain, IPMB ensures favorable pricing and enhanced transparency for its investors through its gold-backed GoldPro Token (GPRO) and GEM NFTs.
A recent report from Cointelegraph sheds light on the intricacies of this pioneering project, outlining the multifaceted challenges faced by gold tokenization solutions, ranging from the complexities of physical gold sourcing to liquidity and backup safeguards for digital tokens. The report unveils an in-house solution crafted by IPMB that meticulously tracks the gold supply chain alongside its fully collateralized GPRO token and the unique GEM NFTs.
Addressing Inefficiencies in the Gold Market
The physical gold supply chain is riddled with multiple intermediaries, driving up price premiums ultimately shouldered by investors. In addition to the inflated costs, complex supply chains present a risk of masking the origins of gold ore, thereby permitting unethical mining practices. Nations such as Ghana, a major gold producer, have faced scrutiny for unregulated artisanal mining practices that are damaging to the environment and often violate human rights.
Streamlining Gold Supply Chains
By co-owning gold mining facilities in Ghana and controlling the entire gold ore delivery process, IPMB eliminates unnecessary intermediaries, thereby increasing both transparency and sustainability across the supply chain. The upcoming launch of the Goldtrace360, an innovative tracking solution developed by IPMB, aims to automate the tracking process and substantially decrease latency. Integrating IoT technologies will enable the documentation of every production step on the blockchain, fostering accountability.
Exploring Gold-backed GEM NFTs
The GEM NFTs offered by IPMB function as digital promissory notes for investment-grade 24-karat gold. Representing ownership titles for gold bars on the Polygon blockchain, these NFTs come in denominations ranging from 1 gram to 12,500 grams, targeting a diverse investor demographic.
GEM NFTs can be acquired by staking GPRO tokens on the Polygon blockchain. Although GPRO tokens are backed 1:1 with gold, they maintain a free-floating price. To earn a discount on specific NFT denominations, users must stake an equivalent amount of GPRO tokens for a duration of three to twelve months, with longer staking periods offering greater discounts. Upon conversion, a unique serial-numbered gold coin or bar will be assigned to the GEM NFT.
Moreover, GEM NFTs that are over one year old can be redeemed for physical gold, with no fees for NFTs exceeding 100 grams in denomination. Unredeemed NFTs remain free from insurance, custody, and management fees for the first five years following their minting date.
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