What Are Tokenized Precious Metals?

Tokenization is a technologically innovative method of gaining exposure to investing products stored in a digital form on a decentralized ledger called the blockchain. 

Silver and gold standard tokens are a new form of investment quickly gaining popularity due to the increased security and efficiency they can provide. The tokenized assets market has already surpassed $20 Billion and keeps rising. But what are tokenized assets specifically, and how can they benefit the precious metals market?

What is Tokenization?

The term “tokenized assets” refers to assets stored as a digital token on a distributed, decentralized public ledger known as the blockchain. The main characteristic of tokenized assets from the practical point of view is that they are secured with military-grade cryptographic algorithms. 

If you purchase gold tokens or tokenized crypto silver coins, hacking into these algorithms would take millions of years since assets stored on the blockchain are practically impossible to steal, forge, or tamper with.

The underlying asset is not stored on the precious metal-backed blockchain protocol. However, that doesn’t mean that the token itself is just a virtual item not backed by anything and with no real value. Instead, the tokenized asset can be considered a digital, cryptographic certificate of ownership of a real, physically existing property – for example, a specific amount of gold or silver, or platinum stored in one of the most secure vaults in the world.

In other words, it would be a mistake to consider tokenized assets as purely virtual properties. While the technology used to prove the ownership of an asset is groundbreaking and innovative, it is used not to create value out of thin air but to represent traditional assets in a form that allows acquiring, storing, and trading them with unprecedented levels of security and efficiency.

The Benefits of Tokenized Assets

Tokenized assets, such as gold-backed crypto tokens, are sometimes compared to investment products such as ETFs, which can be misleading. While ETFs only reflect the price of an underlying asset, tokenized assets represent the absolute legal ownership of a specific amount of a real asset.

Because of that, tokenization can be considered a form of owning a physical asset, which is physically stored in a remote, secure location, while the certificate of ownership is stored on a decentralized ledger. This innovative form of owning assets provides many benefits compared to more traditional forms of investment, such as allowing the everyday person to buy gold cheaply and breaking down barriers to holding accurate sources of income.

Greater Inclusiveness

Tokenized assets can be purchased by anyone, anywhere in the world, as they are not subjected to any limits, which often discourages people from investing in traditional assets such as precious metals. For example, owning large amounts of physical silver requires a considerable investment in security systems or investing in some of the most secure vaults in the world. However, owning tokenized silver crypto coins can provide superb asset protection and significantly reduced costs.

Increased Efficiency

The main problem with investing in physical investment products is that purchasing and reselling them is very inconvenient. Ordering online or locally takes a long time for the order to complete, during which time the prices can change drastically. On the other hand, transferring gold tokens assets is immediate, so you can get in and out of investments whenever you want.

Reduced Costs

Tracking the ownership of physical gold with traditional means is very costly, necessitating high annual fees, often starting at 1% or more of the total value of the investment. On the other hand, blockchain technology relies on decentralization, which means that centralized intermediaries are replaced with automated algorithms. Because of that, trading tokenized gold is very cost-efficient, as the fees are minimal compared to the premiums of traders selling investment products such as physical gold, silver, or platinum.

Investing In Tokenized Gold, Silver, and Platinum

Tokenization can be applied to all markets and assets, but it is instrumental in the case of the precious metals market. As all gold bugs know, precious metals are one of the best stores of value. Still, they also have some disadvantages, mainly related to how hard it is to transport and store metals such as gold, silver, or platinum, especially in larger quantities.

Tokenized gold, silver, and platinum allow transgressing the traditional limits of the precious metals market. It enables investors to gain exposure to a precious metal like gold in a unit agnostic bar and brand. Since the tokenized gold, silver, and platinum serve as digital certificates of legal ownership, they can be processed or transferred instantly. Still, it can also be used to withdraw actual, physical gold at one of the numerous global locations whenever the owner decides so.

Main Advantages of Tokenized Gold, Silver, and Platinum

For the precious metals industry at large, tokenization is a way to allow the market to expand by disrupting it so that it becomes more inclusive. From the point of view of an investor, gold standard tokens can be considered an optimal form of exposure to precious metals since it provides many advantages over both physical metals and precious metals ETFs:

Security

For a long time, storing precious metals in a secure, remote vault was considered the safest way of investing in metals. Tokenized gold and silver add an extra layer of protection to this time-tested method of storing precious metals: while the metal is still held in a vault, its certificate of ownership is secured with state-of-the-art cryptographic algorithms.

Flexibility

Tokenization enables the investors to take complete control over their assets. For example, unlike physical gold, gold crypto tokens assets can be bought or sold 24/7, and the trade order is always executed immediately.

Reliability

Cryptographic algorithms used to secure tokenized assets are impossible to be broken. Therefore, unlike paper certificates, they cannot be forged or tampered with, allowing you to put complete confidence in your investment.

Why Choose Aurus?

Aurus is a fintech company pioneering the idea of empowering investors with exposure to tokenized versions of precious metals, created by a team of industry veterans with decades of experience in the market. The company offers tokenized gold, silver, and platinum: AurusGOLD, AurusSILVER, AurusPLATINUM.

Tokenized gold, silver, and platinum provided by Aurus are not just virtual commodities since all Aurus tokens are 100% backed by physical metals. Each token is redeemable for 1 gram of gold, silver, or platinum, accredited by the London Bullion Market Association (LBMA).

Aurus tokens were designed with sustainability, meaning they are not susceptible to centralized manipulation. Tokens can only be minted by verified bullion suppliers adhering to industry best practices and vaulted by independent and complaint vaulting partners like Brinks and Marlca-Amit that are registered within the protocol. It is important to note that Aurus can never touch or influence the gold crypto token that is traded or vaulted.

Invest In Metal-Backed Blockchain Assets Both Safely and Efficiently

Gold crypto, silver, and platinum are some of the oldest and most reliable financial instruments known to humanity, and all cultures and civilizations have cherished them since antiquity. Invest in Aurus tokenized gold, silver, and platinum now, and see how effortless it is to accumulate grams at a time in the most secure, convenient, and cost-effective way. Tokens can be purchased from Aurus partnered bullion dealers and exchanges.

Earn a passive stream in gold, silver, and platinum for life with AurusDeFi (AWX).

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