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Blockchain to be Used for Trading Gold

posted by Snow on Tuesday November 29 2016, @11:21PM   Printer-friendly
from the that's-as-good-as-money-sir-those-are-IOUs dept.

bootsy writes:

The Royal Mint (the body permitted to strike British coins) have a venture with the US based CME to allow electronic trading of gold.

From the Reuters article:

The Royal Mint will put gold bars into its on-site secure vault, which will then be digitised to create RMGs [Royal Mint Gold] whose ownership will be recorded on the blockchain. Traders will then be able to trade in and out of RMGs between themselves.

Blockchain - or distributed ledger - technology keeps track of and authenticates a continuously growing list of transaction data, which is secured by a global network of computers and is virtually impossible to be tampered with or revised.

The gold would still physically reside with the Mint but could be converted to a physical delivery later. This is fairly standard practice. The Bank Of England used to just wheel a pallet from one side of a vault to another when it changed ownership. The idea seems to be to lower the cost of trading gold which has traditional involved a lot of middle layers who add margins and push up the price.

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  • (Score: 1, Informative) by Anonymous Coward on Wednesday November 30 2016, @03:38AM

    by Anonymous Coward on Wednesday November 30 2016, @03:38AM (#434796)

    Just some signed bits that reside on a computer network. Is this evolution, or what?

    Not a very revolutionary evolution step, the only difference from the precedent: [wikipedia.org] it's on a computer network.

    While the monetary system of Yap appears to use these giant stones as tokens, in fact it relies on an oral history of ownership. Being too large to move, buying an item with these stones is as easy as saying it no longer belongs to you. As long as the transaction is recorded in the oral history, it will now be owned by the person you passed it on to—no physical movement of the stone is required.

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  • (Score: 0) by Anonymous Coward on Thursday December 01 2016, @11:02AM

    by Anonymous Coward on Thursday December 01 2016, @11:02AM (#435381)

    So much for that software patent I was hoping to file, method for using carved stones as currency on a computer.