How blockchain can leverage gold’s popularity with the aid of sustainable mining that rewards investors with discounted gold
Far from a gold bug, Warren Buffett has long been more bugged by gold. "If you own one ounce of gold for an eternity, you will still own one ounce at its end," he once said. But the times have changed. And so has Warren.
In August, after the legendary investor’s Berkshire Hathaway disclosed its quarterly filings, the change in investment portfolio became apparent. Buffett had markedly exited from investments in banks and financial transaction services and made a significant entrance into gold mining stock.
The thinking, by one of the most tracked investors in the world, was clear. It firstly indicated a strong bet that one of the most important sectors of the economy, banking and financial services, is likely to remain under stress, and economic pain will persist. The veteran investor is known for his buy-and-hold long-term investment strategy, selecting areas with strong profitability and long-term competitive edges.
It is therefore also clear what he now thinks of the gold market. Fittingly, the investor with a Midas touch is now distinctly pointing his finger in the direction of gold.
2020 surge in gold prices and looking ahead
Driven by global uncertainty due to the coronavirus pandemic, gold has outperformed all major asset classes this year, gaining nearly 26%. As investors grew more risk-averse, investment flowed into gold.
The supply chains of the entire world have been massively impacted in 2020, and gold’s supply chain has not escaped. Major gold refineries worldwide have shut down and shipments have been delayed causing unprecedented shortages.
Growth in supply of gold has changed little over time, increasing a mere 1.6% over the past 20 years. But demand will likely move even higher, given that gold is one of the most established modes of investment and is a reserve asset. Gold is also highly liquid, carries no credit risk and is scarce.
The uptrend in gold prices is likely to continue given these supply constraints and increasing demand, compounded further by the current weakness in the US dollar. Wall Street sees gold as a safe haven bet amidst the pandemic and fears of a second wave. Analysts worldwide are understandably bullish on the prices of gold, and, despite how the world tackles the coronavirus, it is set to leave a lasting effect for years to come.
There are yet further concerns, including the lack of another major economic stimulus plan from Washington, renewed trade tensions between the US and China, and longer-term worries about a comeback in inflation due to the Federal Reserve's policies of zero interest rates and trillions of dollars in loan programs.
Amidst all this, the launch of CleanGold.io incentivizes investors and sustainable mining
"As we face these unprecedented circumstances worldwide, even gold dealers are struggling to fulfil orders,” said Barnaby Andersun, CEO. “Gold buyers have struggled for reliable sources that actually secure the gold. This is leading to a wider understanding that much gold is held in paper only.”
CleanGold.io is an ambitious and visionary project that has arrived in 2020, which aims to shift the gold mining industry towards sustainability. The project is stimulating the change via an innovative blockchain-financing initiative that will provide discounted gold to early gold buyers to bring liquidity to speed up mining operations.
Said CEO Andersun, “The challenge at this time is that there is not enough gold, and so we have developed the solution to enable the public to go direct to gold miners, and ones that are using the new ‘clean mining’ processes.” All gold will be produced via a patented breakthrough Clean Mining™ process that has eliminated mercury and cyanide from the leaching stage.
To get the network up and running, CleanGold has established a membership scheme whereby sophisticated investors can buy gold at a discount, rewarding their early participation in the mining operation.
Said Andersun, “Our digital certificates track the price of gold, allowing investors to buy gold at a discount on today’s gold price for physical delivery once mining operations are under way in 2021. This allows investors to lock in this discount, to the LBMA gold spot price at the time of purchase, with a right for first refusal for all future mining operations that are on-boarded to the CleanGold ecosystem.”
The company will deploy a new incentives mechanism for mining operations – from the industrial to the artisanal – to digitize their operations using CleanGold’s own purpose-built blockchain. This innovation both enables the market to purchase gold directly from miners and enforces supply chain integrity of sustainable practices, guaranteeing traceability from ore to gold bar to gold coin.
The first mining operations to take advantage of the Clean Mining process, which will be producing the first CleanGold, are from the world’s richest mining fields in Western Australia.
Buffett was right about gold before, and it seems he’s right about gold again. Gold is gold for eternity – but the turbulent times are frothing once more around that obstinate and durable rock. CleanGold aims to serve the times by helping secure the wealth of individuals, but while simultaneously serving also to secure the common wealth that is the environment.
CleanGold™ is a group of visionary investors, miners, blockchain technologists and entrepreneurs aiming to set the standard for enjoying the Earth's bounty without passing a toll to future generations.
Gold buyers can participate in securing their wealth and future wellbeing by becoming a member of the CleanGold™ Pioneer network, see CleanGold.io