What is the difference between an ETF and GOLD?
An ETF (Exchange Traded Fund), is a financial instrument which is backed by commodities or other financial instruments (such as stocks and bonds) and can be traded on an exchange (such as the NYSE Arca). The price of a share in an ETF will fluctuate throughout the trading day based on market conditions.
GOLD is a crypto-asset which functions as an ETF, and is backed by the physical commodity gold. The price of GOLD issued by Goldmint corresponds to the current price of gold as set on the LBMA (http://www.lbma.org.uk) exchange (at the time of sale).
Why is GOLD more beneficial for assets holding?
Physical gold is a challenging and expensive asset to move. It is difficult to secure and cumbersome to transport. Trading gold for other assets requires an assay/appraisal process that is time consuming. GOLD has none of the restrictions of physical gold, yet has the same underlying value. GOLD does not have the same trading risk as gold. It serves as a type of futures contract in that there is a legal agreement to buy or sell gold at a predetermined price at a specific future time.
Transparency
As a crypto-asset, Goldmint discloses the company’s gold reserves and ability to buy back GOLD at its current trading price. Goldmint also transmits information about the number of ounces of physical gold or ETF’s owned by the company. These statements are received from the depository (either electronic or printed) and transmitted to the decentralized blockchain ledger allowing the information to be open and transparent to all members.
Speed
Because GOLD is not encumbered by the barriers of physical gold, members can trade gold quickly and easily. The blockchain makes the process faster, allowing easier trading across borders and shielding investments from loss. GOLD crypto-assets can be converted into fiat money utilizing Goldmint. This eliminates the problem of trading physical gold because the underlying asset (gold) has been evaluated and appraised. The physical gold does not have to be transferred. GOLD cyptoassets are traded in place of the commodity of physical gold. This is intrinsically faster than trading gold or an ETF on a traditional exchange.
How can ETF back GOLD digital assets?
Goldmint would issue to a potential investor GOLD in exchange for gold backed ETF’s. The underlying asset is gold which backs the ETF, making GOLD the liability of Goldmint. This aids the investor in that the investor receives a rate of return on their GOLD crypto-currency. Additionally, the investor is protected from price fluctuations in gold.
The bottom line
GOLD provides an asset which is easily and quickly traded with a degree of transparency that cannot be equaled by ETF’s or physical gold. It provides the investor an ROI independent of the performance of gold.
- Website: https://goldmint.io
- White Paper: https://goldmint.io/white-paper
- Telegram: https://t.me/goldmintio
- Slack: https://slack.goldmint.io
