Digitizing the Ultimate Bearer Asset

Published on
October 22nd, 2019
28 minutes

Digitizing the Ultimate Bearer Asset

The Expert View ·
Featuring Daniel Masters

Published on: October 22nd, 2019 • Duration: 28 minutes

How can gold and cryptocurrencies co-exist in a digital world? Daniel Masters, executive chairman of Coinshares, examines what the digitization of gold means for both gold and bitcoin. Masters argues that the advent of cryptocurrencies unlocked the potential by mitigating gold's physical limitations. Masters dispels several misconceptions about the infrastructure of bitcoin, describes the monetary system in place today, and explains how cryptocurrencies like bitcoin can actually bolster the strengths of the current precious metals market infrastructure. Filmed on October 9, 2019 in London.



  • SK
    Shiu K.
    28 March 2020 @ 15:54
    doesn't matter if you have a bunch of ledgers around the world recording gold in a vault, won't prevent someone who has access to the vault with replacing the gold with swiss cheese?
  • SH
    Simeon H.
    24 February 2020 @ 06:35
    Gold on a Blockchain: can't be done. Blockchains have 0 advantages if they're not decentralised. Gold can only be stored and managed in a centralised way. See the problem?
  • CV
    Chris V.
    21 November 2019 @ 05:22
    Internet 3.0 is internet of value. XRP???
  • YT
    Yasushi T.
    4 November 2019 @ 17:00
    I like this. The reason is it seems easir for me to make sure it is real official PAMP gold or not. I am not yet sure that the gold bar at the secondly market in the street is real PAMP or not.
  • sc
    sung c.
    22 October 2019 @ 16:33
    The main problem I see with the digitization of gold would mean there would eventually have to be large storage keepers of the digitized gold bullion. This is the same "Goldsmiths" which gave rise to the likes of Rothschild which eventually gave rise to Central Bank system we currently have. In other words, it would just the start of the same thing all over again.
    • DS
      Derek S.
      24 October 2019 @ 20:27
      Bingo. "Here let me watch that for you for a small fee"... Nobody watches out for someone else unless it can benefit them directly. Same thing with digital currencies
  • EB
    Eric B.
    24 October 2019 @ 15:15
    XRP? Yikes.
  • SA
    Sanne A.
    23 October 2019 @ 10:05
    This is the worst of both worlds. Don't trust intermediaries, they have become obsolete from a technical perspective. (regulations is what keeps intermediaries in business). A federated chain with roll backs via hard forks? Mate, just use a relational database. Not your private keys, not your bitcoin. Own physical gold.
  • RO
    Robert O.
    23 October 2019 @ 04:47
    What is his advantage over GoldMoney or Kinesis Money?
  • AT
    Aaron T.
    23 October 2019 @ 04:38
    Own btc and physical
  • JM
    Jeremy M.
    22 October 2019 @ 18:05
    Perth Mint Australia has recently tokenized Gold. https://pmgt.io/
    • TS
      Tom S.
      23 October 2019 @ 02:37
      PMGT are just unallocated storage with PM. No different to PMDP. Can't be traded outside of their closed system ie their app with other app users. All has to be redeemed via PM through your linked bank account. There is zero utility in buying these as opposed to straight unallocated gold.
  • JS
    Jim S.
    23 October 2019 @ 02:17
    Anybody look or use at https://www.onegold.com/... I’ve looked into it...Thoughts?
  • tk
    timothy k.
    23 October 2019 @ 01:22
  • MR
    Manuel R.
    22 October 2019 @ 13:43
    why to create a gold token when we have bitcoin? No sense
    • RM
      Robert M.
      22 October 2019 @ 14:27
      Backed by a physical asset, not fiat money, held by central banks.
    • tk
      timothy k.
      23 October 2019 @ 01:22
      Bitcoin has corrected the 5,000 year problem with money. It does not need good.
  • RM
    Ross M.
    22 October 2019 @ 20:14
    Google Kinesis Money already up and running way ahead of this.
  • CT
    Crispim T.
    22 October 2019 @ 19:11
    Gold is heavy manipulated already. You can tokenize it all you want but unless you can really audit it on the base layer (BTC) you'll never know what's going on behind the scenes. Scammy projects like DIG already tried this and failed of course. A lot of the "gold" out there is just on paper already, vapor. Putting it on "the blockchain" won't make it any better. You have two ways to be sure about your store of value: -Hold it yourself and verify it yourself. Possible with gold, but difficult and expensive. -Very easy with bitcoin. Cheap storage, 100% verifiable, no margin for fractional reserves if you audit the chain. There's no point in using Bitcoin to make gold better - it's much simpler and more efficient/safer to own Bitcoin directly.
  • SP
    Simon P.
    22 October 2019 @ 18:56
    without immutability, this centralisation of a blockchain will inevitably lead us to the problems of today, might be 10, might be 100 years.
  • CH
    Crag H.
    22 October 2019 @ 17:26
    Trying to make gold sexy by "putting it on the blockchain". Just stop. Gold has it's place in every portfolio and is only valuable because of it's physical properties. Being physical is a feature, not a bug. The whole point of using a decentralized blockchain is to be able to verify the integrity of the system *by yourself*. This is impossible to do once you try to mix the physical world with the digital. How do you verify the amount of gold in a vault without going there in person and weighing the bars? You can't. Bitcoin is awesome and so is gold. And Bitcoin is rapidly raising awarness among younger generations about concepts such as scarcity, store of value and sound money. If anything, that should be a net positive for gold as well.
    • RW
      Ryan W.
      22 October 2019 @ 18:18
      It's not making gold sexy, it's finding legitimate use cases for blockchain. Keep your gold physical and safe. However there is a large part of the world that may find it hard to keep it safe, so centralized storage and distributed account may make sense for them. The two reasons for doing this (record keeping and fractionalization) seem valid to me, Having said that, this is a bit akin to the wealth of the Californian Gold Rush being in selling supplies and services to the miners. That's OK, more people are busy and their time occupied and that's good for global economy, assumptions therein. However, the 2nd layer aspect providing backdoors to various financial or government authorities... really? Really? I think the canary just died.
  • FM
    Frank M.
    22 October 2019 @ 15:20
    This is just a digital version of paper warehouse receipts. They cant solve the problem that eventually infiltrates all of these scheme... they will issue more digital gold units than they have gold in the vault
  • AK
    Ado K.
    22 October 2019 @ 08:33
    The system he describes is completely based on trusting the entity behind the token representing the gold. First you have to trust that they will not alter your balance on the ledger, second you have to trust that they will not reverse or censor your transaction, for instance if you try to send the gold backed token to an Iranian or an Venezuelan. You have to trust that there is actually a sufficient amount of gold behind each token, you have to trust that the government will not seize it. You have to trust that you token can not be seized or frozen. If an auditor does inventory on the physical gold you have to trust the auditor. I am a Bitcoiner, so I believe heavily in the ethos do not trust verify, so for me this is a lackluster solution. I prefer running my own full node and doing final settlement on my own with my own private keys. I am not saying that this does not have value for some people or that gold is not great. But for me gold is great to have as a physical asset that you yourself hold, not that a "trusted custodian" holds for you.
    • HJ
      Hendrik J.
      22 October 2019 @ 14:43
      let's also consider the scenario where you lose the private keys. Does nobody 'own' that gold then? if there are backups of keys, then that just introduces risk and another attack vector
    • Bv
      Berend v.
      22 October 2019 @ 15:05
      Well put!
  • JA
    Justin A.
    22 October 2019 @ 13:45
    https://kinesis.money/ Already does all of this and it is working today. Debit card will be active this quarter. Watch this video: https://youtu.be/gOLPIehL220