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InfiniGold, a precious metals digitisation company, has launched a digital token on a public blockchain backed by government guaranteed gold.
The Perth Mint Gold Token (PMGT) is an ERC-20 compatible asset-backed token backed 1:1 by GoldPass certificates issued by The Perth Mint, Australia's official bullion mint and wholly owned by the Government of Western Australia.
In its press release, InfiniGold describes PMGT as “digitised gold” that will basically allow users to acquire and have entitlement over government guaranteed physical gold stored at The Perth Mint in a convenient, trusted and cost-effective way. For institutional investors, it would be an alternative to traditional gold products such as gold ETFs but with added benefits such as real-time trading and settlement enabled by blockchain technology.
“We’ve been looking forward to unveiling PMGT, an exciting result of our collaboration with The Perth Mint - the preeminent precious metals institution in the world. With The Perth Mint as custodian of the underlying physical gold that backs PMGT, buyers will be able to access a secure and reliable token representing the strongest asset class to date – gold,” Andreas Ruf, CEO of InfiniGold said.
Digitisation of The Perth Mint’s inventory kicked off last year with the launch of GoldPass, allowing investors to instantly and securely buy, sell and transfer physical gold via digital certificates using a mobile app. Each certificate is fully backed by physical Perth Mint gold stored in its network of central bank grade vaults, with every ounce of gold held in storage guaranteed by the Government of Western Australia.
Richard Hayes, Chief Executive Officer of The Perth Mint, said that the digitisation of gold via a public ledger is a “natural progression for the global commodity markets” adding that it will “promote gold as a mainstream asset, enhance its accessibility, and offer greater liquidity, transparency and auditability of the real assets backing this type of digital token.”
“We’re delighted to be working with InfiniGold and offer safe storage for the physical gold we will supply and hold, as our role as custodian through GoldPass certificates,” he said.
The real-time liquidity of PMGT is provided by market makers and enabled via The Perth Mint GoldPass platform. Users can sell the digital certificates back to The Perth Mint, or take delivery of their holdings by exchanging their GoldPass certificates for a range of the Mint’s gold products, including LBMA London Good Delivery (LGD) bars.
“Subject to final regulatory consultation, this will make PMGT directly tradable against traditional gold products, including gold ETFs, CME gold futures, and physical XAU,” the release said.
InfiniGold further revealed that it worked with Ernst and Young to perform a findings and recommendations report on the design effectiveness of the procedures and controls over the PMGT platform.
“We chose to proactively work with EY to implement strong procedures and controls around the PMGT platform well before go-live as we know effective management of digital assets risks is critical to our investors and we felt EY were best placed to assist us,” Ruf added.
