Why Gold?
Part 1 of a series showing why gold is the best option and AgAu the best way to access it.
Precious metals have been a unit of account throughout the ages. Historically, gold as money is probably one of the first universal consensus ever reached.
According to Chapter IV of The Wealth of Nations by famous economist Adam Smith (1776), when mankind began to organise into a civilised society, the aspect of trade quickly appeared. Soon, civilisations started using a barter system in which they gave “value” to certain objects — they would later trade for other objects considered of equal worth. With the discovery of gold (Au) and silver (Ag) more than 3000 B.C, a new era of money began with a new value system consisting of the exchange of tokens and later coins. Gold and its chemical property of immutability through time quickly became the standard to store value.
Money is fundamentally a medium of exchange, a unit of account, and a store of value. Unfortunately, ever since the departure from a gold standard, “paper money” or fiat (backed by trust) has increasingly become politicized through what is called today “monetary policy”.
Today, alternative options to cash are rather unappealing or non-existent. In a world where cash is becoming increasingly irrelevant, the thought of having no other solution becomes unacceptable.
We see Bitcoin as a private sector initiative to solve “The Money Problem”. Although, Bitcoin can be credited for raising the question of “what is money?” Bitcoin has by-in-large failed at being a viable form of money; not only because it falls short in terms of scalability, high volatility and arguably low levels of privacy, but more fundamentally because it falls back into a “fiat” paradigm with the major difference being that:
· The trust is concentrated in a robust public encrypted ledger
· The supply is limited
Simply put, Bitcoin might be better than central bank fiat currencies but still falls within the electronic fiat category.
Compared to any fiat solution gold has extremely low volatility. We believe Gold as money is an Antifragile idea, meaning that history has shown that the more we depart from the gold standard the more evident it is proven to be the only sustainable form of hard money often called “sound money”.
Historically, one can argue that the proportional holdings of gold by private and public entities as well as central banks are the direct result of trade flows and balances between the nations over millennials thus, If a monetary reset was to occur the most likely consensus across the world would most probably be gold.
In this context is safe to say that precious metals are a hedge against systemic failures. History has proven that during difficult times cash/currencies can go through a confidence crisis, while gold survived and thrived showing that Gold can also be a sound investment…the chart above shows gold prices rise during the recent pandemic. While many economists fear that our current recession turns into a depression, gold is positioned as a safe-haven asset.
Gold is apolitical and self-sovereign, meaning that there is no authority to rule gold unilaterally “by decree” as opposed to fiat. The convention of gold as money has not been defined by government bureaus but by natural law and universal consensus.” -AgAu.io White Paper
AgAu is changing the way we transact with gold. AgAu provides the ultimate tool to finally be able to use gold universally with close to no costs in digital form.
AgAu uses smart contracts, blockchain technology and distributed ledgers in order to allow the re-birth of a decentralised gold standard where users maintain the direct ownership of their money.
AgAu allows the electronic direct ownership and transfer of physical and allocated LBMA Good Delivery quality gold and silver secured by Swiss private property laws. In other words, AgAu is the purest and most efficient form to bring back a real gold standard where the ownership of the money resides directly with the user. AgAu.io White Paper
