Recently, one of the most significant events in the financial markets involved settling a huge score between Wall Street giants and Redditors. It began with a stock called GameStop, where the Reddit community came together to bet against the institutions by coordinating a massive short squeeze on the popular trading platform called Robinhood. They broke the price barrier, boosting the GME share price from $20 to $350 over two weeks. This left hedge funds sweating over their leveraged short positions.
Although Robinhood controversially decided to step in to halt trading, a movement had already been sparked. Small investors could take a stance by working together for the first time. Soon after that, Redditors set their sights on arguably one of the most manipulated markets, silver, in an attempt to pull off the biggest short squeeze in history. As a result, the price of silver reached an 8-year high of over $30 per ounce but soon retreated as the suppressive forces overruled.
This whole debacle exposed several flaws in financial markets, particularly concerning silver. The problem with the silver market is that it is largely made up of paper-based assets, like ETFs, which are primarily denominated in physical silver but aren't representative of full ownership of the physical metal like silver-backed crypto would be able to do. Although redeemable under certain circumstances, investors' issue with instruments like 'paper silver is the extraordinary imbalance of the collateral relative to the issued contracts, as they are not fully backed.
Therefore, if all ETF holders were to request a physical redemption at the same time, the exchange wouldn't be able to pay all investors in physical silver and may be forced to cash-settle some of its commitments, if at all. This means having to convert silver to dollars.
Tokenization is not a new idea in the digital world, as several solutions already exist in this sphere. Aurus enters the market as a new player striving to create a decentralized system for tokenizing gold and other precious metals. The platform allows reputable industry players, including refineries and brokers, to independently mint tokens 1:1 backed by physically allocated gold or silver. Silver crypto coins would allow much more efficient undertakings in the market, such as direct ownership and instant settlement.
Aurus distinguishes itself by joining gold & silver providers, vaults, and distributors under one ecosystem to establish a decentralized network of trust. Industry players are encouraged to participate by receiving a portion of the rewards generated within the ecosystem. In addition, Aurus aims to modernize so-called 'paper-assets' by providing users access to actual ownership of the underlying assets, for example, where each AurusGOLD (AWG) token represents ownership of one gram of gold sourced from LBMA-accredited refineries.
Considering the nature of demand for precious metals, it is common for the physical markets to dry up in times of turmoil. In turn, the paper-based commodity markets are ruling the space, creating a massive disadvantage for retail investors. Aurus hopes to offer people a reliable alternative through a transparent platform immune to control or manipulation by a centralized government, thereby adhering to the decentralized nature of blockchain technology.
The platform's second objective is to increase the liquidity and stability of the precious metals market. The Aurus platform's tokens stand as a hedge against volatility while facilitating instantaneous transactions on a global scale. Furthermore, it aims to eliminate barriers in payment systems by bringing cheap, speedy, and cross-border payment solutions.
Aurus focuses on Europe, Africa, South America, and the Middle East to expand its reach whilst planning for later expansions to other regions.
For Aurus to deliver on its promise to users, it has developed various products and services that help to facilitate and simplify the usability and exchange of the tokens within the ecosystem.
First is the AurusGOLD (AWG) gold-backed crypto token, an ERC-20 token divisible into 18 decimal places to enable transactions as small as a cup of coffee. It includes all the proven benefits of gold as a stable store of value and combines this with the transactional efficiencies and security of cryptocurrencies. In addition, to ensure a high level of trust is achieved throughout the network, Aurus employs a smart contract that conducts regular audits on the gold supplies supported by an ERC-721 token to track the gold inventories vaulted around the world accurately.
Second is the AurusDeFi (AWX) token, a reward-sharing token that allows participants to invest in the success of the overall Aurus blockchain network. AWX has a limited supply of only 30,000,000 tokens. AWX holders receive a portion of the vaulting and transaction fees generated from all the tokens in the ecosystem. At the same time, the remaining rewards are divided equally between providers and vaulting partners. This creates a tremendous long-term reward stream for AWX holders, regardless of market conditions.
Last but not least are the Aurus Vault Card and the Aurus Mobile App. The card is a cold wallet that allows you to store and transfer Aurus tokens safely. It is linked to the Aurus App to present a straightforward and safe way to interact with their metal-backed crypto tokens. Aurus is currently developing the ability for users to quickly accumulate Aurus' tokens directly in-app and linked to various currency pairs.
The recent Reddit-Wall Street racket presented a unique opportunity for Aurus to provide new and existing silver enthusiasts with a more reliable alternative with the launch of their latest offering AurusSILVER (AWS), a digital silver crypto coin. UK-based gold broker Direct Bullion was the first entity to tokenize silver on the Aurus platform, minting 200 ounces of silver on the protocol.
Aurus targets easy access to direct silver ownership without manipulating paper markets, which currently overshadow the precious metals market. One AWS token represents 1 gram of LBMA-accredited silver. Aurus also plans to present a new fee system to support its current move into silver. Now, all AWX holders will not only earn from the AWG network but will also earn from the fees accumulated from AWS transactions too.
AurusSILVER (AWS) tokenized silver crypto coins will be directly linked to the Aurus App to facilitate instantaneous and fluid transactions of silver globally.
From a global macro perspective, the pandemic has severely affected growth in all markets as trillions of dollars have been printed by central banks. Low-to-negative interest rates and the ever-increasing risk of an influx of inflation are all realities that face investors. With that said, the demand for alternative stores of value, like gold crypto tokens, silver-backed crypto tokens, and other precious metal tokens, will inevitably increase faster than anyone expects.
Aurus has a revolutionary approach to solving today's problems affecting the precious metals market. Furthermore, the platform is working towards a free and fair ecosystem that will enable an equal chance for all interested parties, regardless of how big or small, to invest and transact in precious metals and ultimately protect the value of their investments and savings now and in the future.
Aurus shows that asset tokenization is the next big trend to break down the barriers in most economies through its various tokenization services. However, the Aurus ecosystem promises this is just the beginning of its quest to transform this space entirely.
Who knows what the future holds? However, based on current developments, it is not so difficult to envision the introduction of AurusPLATINUM and other alternative investment solutions in the coming months.