New York-based crypto company Paxos announced last Wednesday its new product: PAX Gold. This product, which is the first gold token in the market, will allow the public to acquire a digital token backed by one troy ounce of gold held in a London vault.
This token, according to the company, will provide the actual ownership of that gold, as customers will have the serial number of the corresponding gold bar in London. Besides, users will be able to buy and sell PAX Gold tokens on various blockchain networks, which will keep track of the reallocation of property rights to the gold.
According to Chad Cascarilla, CEO of Paxos, this token is the cheapest way to own gold, and it’s more cashable than having gold through an EFT. Also, he noted that Paxos won’t charge annual custody fees.
Cascarilla added that it’s not necessary to have knowledge of blockchains or cryptocurrencies to own PAX Gold tokens; those who wish to buy and have gold just have to access the Paxos website, buy the tokens, and the company will take care of them. Plus, those who wish to trade their tokens actively can obtain a digital wallet, sell their PAX Gold tokens, or even lend them.
However, all that glitters is not gold. Due to the high costs that storing gold involves, and the payment that Paxos will make to Brinks for its protection in its vault located in London, these expenses must be transferred to Paxos users. Therefore, the service is not free.
The launch of this token by Paxos coincides with the current debate in the financial world about whether gold or Bitcoin is a superior store of value for investors. In this way, it can be said that the PAX Gold token would be a bridge between both fields.