Crypto Traders Can Invest in Precious Metals Like Gold, Possibly on Exchanges
A Swiss-based asset management firm, Tiberius Group AG, is introducing a new product to the crypto markets: metal backed tokens. The new product will be a digital token that is backed by seven metals and will be first offered to prospective investors starting on October 1.
The new token – called the Tiberius Coin – is unique in that it will be backed by seven metals, closely tracking their value, making it similar, although slightly more volatile, than a stable coin.
The token will utilize the market prices of Copper, Aluminum, Nickel, Cobalt, Tin, Gold, and Platinum, and will allow investors to weight their cryptocurrency portfolios with the stability and diversity of multiple metals.
Giuseppe Rapallo, the CEO of the company’s technology ventures arm, spoke about the new product, saying:
“Instead of underlying the digital currency with only one commodity, we have chosen a mix of technology metals, stability metals and electric vehicle metals. This will give the coin diversification, making it more stable and attractive for investors.”
Investing in Physical Assets With Crypto
The Tiberius crypto project was first announced in January of this year, when the group’s CEO, Christoph Eibl, explained that the new crypto would be the group’s first foray into the cryptocurrency markets, and Eibl initially expressed hope that the Tiberius Coin would be launched in July.
After a several month delay, more details surrounding the token’s launch have become clearer, with Bloomberg reporting that the new token will be initially offered at $0.70, and it will be sold under Swiss law as a fully regulated and approved offering.
Rapallo explained that the token’s supply will be fully based on demand and that the supply will be limited by the availability of the underlying metals.
The Tiberius Coin will be weighted mostly by Copper, with the metal accounting for nearly 25% of the underlying commodity basket, followed by Gold, which accounts for nearly 20% of the commodity basket. Tin, Aluminum, Nickel, Cobalt, and Platinum account for the remaining 55% of the coin’s underlying commodities.
Initially, the coin will be exclusively listed on LATOKEN, an Estonia-based exchange that is compliant with Swiss regulatory authorities.
The goal of the new token, according to Eibl, is to be used as a store of value and a method of payments, representing a modern take on traditional means of bartering.
Tight Competition for Metal-backed Cryptocurrency
Although Tiberius Coin looks like a promising addition to the cryptocurrency marketplace, there are many other metal-backed cryptocurrencies competing with similar goals.
Adrian Ash, the research director at London-based BullionVault, spoke critically about metal-backed stable coins, saying:
“There are dozens of firms who launched stable coins linked to metals, and so far, none of them have gained any traction… They’re trying to solve a problem that doesn’t exist — all of this can be achieved without the additional cost of a distributed ledger.”
What sets Tiberius apart from the other metal-backed cryptos, many of which are solely backed by Gold, is that it has multiple commodities in its underlying asset basket, and that it is being sold in a fully regulated environment.
Prospective investors may also be interested to hear that they can swap their Tiberius Coins in for physical commodities, although they must swap at least $10,000 worth of the token due to the assets being measured in tons.
If successfully utilized, the new cryptocurrency could prove to be an effective way for companies and individuals to procure, store, and trade valuable metals.
Featured image from Shutterstock
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