With the strong global demand for gold and the price of assets reaching record highs, investors face difficult choices among a variety of gold investment vehicles. Traditional methods of investing in gold have many drawbacks. Physical gold incurs significant trading fees and gold futures require sophisticated financial literacy, but gold-backed cryptocurrencies often lack reliable preliminary audits.
IPMB: Together with gold and cryptocurrency
The International Precious Metals Bullion Group (IPMB) combines the vast experience in the gold industry with the opportunities offered by blockchain technology to provide a new approach to reliable and cost-effective gold investment. By controlling key steps in the supply chain, IPMB offers favorable pricing and transparency for GoldBacked GoldPro Tokens (GPRO) and GEM NFT investors.
A recent report published by Cointelegraph provides insight into this precious metals project. It outlines the challenges faced by gold tokenization solutions, from physical gold issues to providing digital token liquidity and backup guarantees. This report describes the in-house solutions developed by IPMB, explaining the gold supply chain, gold-backed GPRO tokens, and gold-backed GEM NFTs. This report concludes with an overview of the IPMB ecosystem and its future development plans.
Inefficient gold market
The physical gold supply chain relies on multiple intermediaries, ultimately at a price premium borne by investors. Additionally, physical gold investments will have a premium upon purchase, with substantial buy/sell spreads and custody fees of up to 1% per year.
In addition to increased costs, the complex gold supply chain makes it easier to hide the origins of gold ore and to hide unethical mining. Ghana, a leading gold producer, for example, faces criticism of unregulated artisan mining, which harms the environment and often violates human rights.
Streamlining the Gold Supply Chain
In contrast to most existing gold tokenization solutions that rely on third-party supplies, IPMB co-owns gold mining facilities in Ghana and manages the entire gold ore delivery process. As a result, IPMB eliminates unnecessary intermediaries and achieves transparency and sustainability across the supply chain.
The upcoming launch of Goldtrace360, an internal tracking solution designed by IPMB, will automate the tracking process and significantly reduce latency. Goldtrace360 utilizes IoT technology to record every step of the gold production process on the blockchain.
Introducing the gold-backed gem NFT
GEM NFT is an offer from the Digital Promise Note IPMB for investment grade 24 carat gold. GEM NFT is the ownership title for the Gold Bar of the polygon blockchain. They cater to a wide range of potential investors, ranging from 1 gram to 12,500 grams.
GEM NFTs can be obtained by staking GPRO, the native token of the IPMB ecosystem on the polygon blockchain. The GPRO token is backed by 1:1 gold, but the price is free to float.
To get NFTs for a particular denomination at a discount, users must wager a corresponding number of GPRO tokens for 3 to 12 months. Longer staking rewards with higher discounts. If 100 GPRO tokens have been stained for 12 months, 89 GPRO will be converted to GEM NFT and 11 GPRO will be returned to the user. A limited number of NFTs are allocated monthly for staking.
If the user triggers a GPRO to trigger a GEM NFT conversion at the end of the staking period, the GPRO will be burned. At the same time, GEM NFTs will be assigned a unique 24-carat gold coin or bar, which is also reflected in the NFT metadata, and a London Bullion Market Association (LBMA) serial number.
At least one year ago GEM NFTs can be redeemed for physical gold, and redis is free for 100 grams of gold NFTs in the sect. If not redeemed, NFTS will not have insurance, custody or administrative fees for the first five years of the Mint.
This article does not include investment advice or recommendations. All investment and trading movements include risk and readers must do their own research when making decisions.
This article is for general informational purposes and is not intended to be considered legal or investment advice, and should not be done. The views, thoughts and opinions expressed here are the authors alone and do not necessarily reflect or express Cointregraph’s views and opinions.
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