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08th Dec 2021

Blockchain-Based Tokenization of Precious Metals

A New Word in the Investment World 

Tokenization is one of the modern tech trends that is undergoing rapid development and widespread adoption right now. Together with Blockchain technology, it provides an opportunity to change the global economy, to make it more stable and advanced. Investments in tokenized assets, especially precious metals, have enormous potential and offer unprecedented prospects. 

Tokenized Precious Metals 

Tokenized assets exist on the digital plane in the form of tokens that are backed, that is, issued, on the basis of real physical assets. Tokens are created on blockchains (Ethereum, Cardano, etc.). You can learn more about asset tokenization here

Tokenized assets are protected, so to speak, by the complexity of blockchain technology. Thanks to its general automation and transparency, it is virtually impossible to hack it, which means that it is impossible to steal and/or counterfeit a tokenized asset, which is more than a relevant problem for an asset as delicate as precious metals. 

Tokens funded by precious metals and issued through ICO/STO represent a kind of digital certificate of distributed ownership of this asset. Investors can claim a stipulated portion of the precious metal by buying these tokens. That is, with blockchain-based tokenization, gold/silver/platinum can be acquired and traded with a high level of protection and competence. The new service of Clevver, ClevverCrypto is ready to offer quality assistance in your token campaign. 

Benefits of Tokenized Precious Metals 

There are numerous advantages that tokenized precious metals can offer. We will name 3 of the most relevant ones for regular investors: 

  1. It is no exaggeration to say that precious metals, namely gold and silver, have been used as an investment option since the beginning of time. Mankind has always had a soft spot for them. They have not lost their appeal even now, but modern technologies such as blockchain and tokenization offer a different perspective on the investing process in these assets. The above-mentioned tokenization of precious metals, in addition to all other manipulations, involves the creation of a smart contract. This digital document is highly secure, does not require the participation of third parties, and guarantees the fulfillment of the prescribed obligations. Thus, the first advantage of tokenized gold will be the absence of unreasonable costs thanks to smart contacts. It will be as easy to sell tokenized gold as any other asset or cryptocurrency.  
  1. While there is a real danger of “getting caught by fraudsters” when buying regular gold/silver, in a similar transaction where tokenized precious metal is involved, this is literally impossible. Why? Because the tokenized asset’s characteristics and movement are constantly monitored and reported on the blockchain using RFID scanning of the precious metal. It sends data about the location of the asset and its properties to the blockchain. This way, the investor always has all the necessary information, which cannot be tampered with, about the asset when buying it. Defeating fraud is the second significant advantage that a tokenized precious asset is willing to offer. 
  1. Blockchain tokenized gold/silver is stored in a secure place with all precautions, without being moved. At the same time, tokens backed with this precious metals can easily be traded without reference to place or time, in a decentralized manner. Accordingly, the third significant advantage of tokenized precious metals is the possibility to increase liquidity by selling the gold/silver to verified individuals around the world regardless of one's geographic location. 

Summary 

It is safe to say that the tokenization of real-world assets on the blockchain presents the greatest opportunities and the list of these very assets will only grow. As for tokenized precious metals — they will be the solution that investors who wanted to invest in gold, silver, or platinum have been looking for, for a long time. Tokens backed by precious metals can be bought not only at a fair price, but also safely, transparently, and without fear of fraud. 

ClevverCrypto offers comprehensive solutions for the tokenization of various assets. Reach out to our team and start your tokenization project already today! 

DISCLAIMER: Any legal, tax, or investment advice in this communication (including any attachments) is for information purposes only and is not intended to be used, and cannot be used against Clevver or its Sender. The sender is neither an Accountant nor a Lawyer and cannot be made liable. Please, contact your tax accountant for individual consultation. Clevver does not provide any legal/ investment/ tax advice itself. Clevver works together with a network of lawyers and tax advisors that provide all necessary individual legal advice. 

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