Can you invest in the precious metal industry with Bitcoin? What about other cryptocurrencies? The answer to both questions is “Yes”.
Since the creation of Bitcoin in 2008, its price has increased. As a result of its increasing value, it has also become accepted as a method of payment. Little wonder why: Bitcoin is also a currency for online payments and a commodity for storing value.
And the crypto revolution has led to an explosion in both the number and value of other digital currencies, including Ethereum, Ripple, Litecoin, and hundreds of others.
As this new revolution sector has evolved, companies have witnessed incredible growth in the “pair trade” between gold and cryptos—investors who swap their digital coins for physical gold and silver, and sometimes back again, using precious metals for both diversification and as a stable value store during turbulent times.
How to Invest in Precious Metal With Bitcoin Through a Broker?
Many companies like Sharpspixley, Money Metals, Vaultoro, GoldSilver, and others have started offering the service to buy gold or silver with cryptocurrency, all happening easily and quickly in a few steps. All these companies have been designed for the crypto age, to the point that you don’t need a bank account connected to your broker account. With the built-in wallet in your account, buying gold with bitcoin is a seamless operation. Once your account is set up and you have transferred your bitcoin, you can buy gold in seconds.
If you don’t have bitcoin in your crypto portfolio you can deposit with altcoins using the ShapeShift function within your wallet. This will convert popular cryptocurrencies into bitcoin, which can then be traded for gold.
Opening an account in any of these brokers is a simple process which anyone from any country can do. Once your account is opened you will need to be verified to trade. Unlike bitcoin, if you for some reason lost access to your email, you can access your account by proving your identity. Become verified by uploading a copy of your passport or driver’s license, and a photo of a bank statement or utility bill that is less than 3 months old.
Alternative Ways to Invest in Precious Metals With Cryptocurrencies
Buying gold-backed tokens when they are listed on any crypto exchange or through IEOs are other ways to invest in precious metals with cryptocurrencies. Let’s see some of the tokens that are backed by gold.
Sudan Gold Coin(SGC)
Sudan Gold coin (SGC) is one of the first projects, which combines blockchain technologies, gold and precious metal-trading decentralized platform, and real production of gold with high transparency and fair distribution of profits. SGC is creating on the Ethereum Smart Contract that provides security and transparency of the invested funds. It is backed by gold and any SGC Token holders will have the opportunity to exchange their tokens for physical gold, as an example, the company gives us basic ration [10 SGC =0.02 g of gold i.e. 1 token = 0.10USD].
DigixGlobal (DGX and DGD)
DigixGlobal has created two types of Ethereum tokens – each with unique properties. DGX Digix Gold Token represents 1 gram of 99.99% LMBA standard gold, secured in Safehouse vaults. Digix DAO Tokens (DGD) is used to claim quarterly rewards based on the total DGX collected through transaction fees. The DGD value fluctuates based on exchange rates and market forces. This coin is listed in most of the exchanges and you can buy it directly from Binance, OKEx or Huobi Global.
Jinbi(JNB) is a UK and Belarus token backed by an increasing physical gold floor from the production of gold by the mining partner. Jinbi will create liquidity events following production milestones whereby each coin holder will receive a dividend payable in physical gold or Jinbi Token (JNB). All other funds are reinvested back into Jinbi to continue further gold production. Jinbi token is listed in Cryptex, DDEX, and Livecoin.
The GLDS token is a multifunctional instrument that can be utilized in various ways. The intrinsic value of GLDS tokens stems from gold parity. Each token a GLDS holder owns is worth 0.02 grams of gold. The nominal price of GLDS is 1 dollar, but during the ICO tokens are available for purchase with a bonus. This effectively means that early adopters of our token are buying gold for the best possible price available anywhere on the market.
The significant difference between the two ways to invest in precious metals with cryptocurrencies is the risk we take and the profit we can make. If we use a broker from which to buy gold or other precious metal directly, the risk is minimal with great losses. This method is used by investors for hedging because the volatility of the crypto market is quite high. The risk of losing your choice to invest through a gold-backed token is high, but here you can also expect a much higher return on equity.