Gold-backed digital tokens to hit Turkish market following new partnership
The partnership enables investors to purchase grams of accredited gold as ERC-20 tokens.
Gold wholesalers are starting to find new ways to expand their businesses to retail, thanks to blockchain-based tokenization. International bullion trading company AgaBullion and United Kingdom-based fintech Aurus Technologies have signed a partnership to offer gold-backed tokens in the Turkish market.
The partnership will see investors own grams of LBMA-accredited gold via AurusGOLD. As a gold-backed ERC-20 token on the Ethereum blockchain, AurusGOLD (AWG) is minted and distributed by precious metals dealers using Aurus’ blockchain-based solution.
“Gold is the oldest decentralized finance system in the world,” AgaBullion chairman Gökhan Yılmaz said, “It has become a globally recognized and established ecosystem.” He added that since the lack of underlying assets and high volatility renders other cryptocurrencies unreliable, a physically-backed token makes sense.
“We see a huge potential for digital precious metals,” AgaBulllion CEO Sarp Tarhanaci stated. “By partnering with Aurus, we can now use their blockchain platform to facilitate fractional gold ownership in Turkey.”
Turkey’s history in investing physical gold, along with the high adoption rate of crypto as an alternative way to protect wealth, makes the country an attractive market for digital gold, AgaBullion told Cointelegraph.
Speaking on the opportunities in the market, AgaBullion explained that the COVID-19-related lockdown in Turkey made it impossible for citizens to access physical gold:
“People in Turkey are looking for something reliable and sustainable. Due to its centralized structure, it’s not efficient for consumers to buy gold from online platforms provided by banks. For AgaBullion, the most logical next step is a digital product.”
Turkey is known as one of the largest gold markets globally, where the precious metal is widely recognized as a form of wealth. Aurus business development manager Mark Gesterkamp said:
“AgaBullion is an approved member of Borsa İstanbul, offering the infrastructure, market knowledge, and network of clients for us to expand further the usability of digital gold and other precious metals in Turkey.”
Aurus told Cointelegraph that the ultimate goal for AWG is to position it as a means of payment. The team does not want to compete with fiat currencies, but they aim to offer a reliable and stable alternative.
Blockchain technology allows for an inclusive and efficient system, the firm said. “It makes precious metals accessible to ordinary people and not just the privileged sophisticated investors that largely dominate the market currently.”
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Author: Erhan Kahraman