【Nuremberg, G】Digital Fingerprint for Gold: “More Trust and Transparency”

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Editor’s Note

This article explores how digital innovations like blockchain are transforming the traditionally conservative gold industry. Industry leaders discuss the potential for “tokenizing” physical gold, aiming to enhance transparency and accessibility for investors.

Gold, digital, Blockchain, Goldbarren (Bild: Goldreporter)
Physical Gold

There are increasing efforts within the rather conservative gold industry to implement digital technology at various stages of the value chain – for example, blockchain. In an interview with Goldreporter, the managing directors of ZIEMANN VALOR, Markus Osiander and Markus Pieper, explain the plans in this area and the anticipated benefits for the industry and investors – such as in the “tokenization” of physical gold.

“All the mentioned developments will sooner or later impact corporate planning. For us, it is important to recognize these changes and familiarize ourselves with the requirements and expectations in order to respond. How can trust be strengthened and transparency increased – here, for example, we are in close exchange with other companies and our partner, the Swiss technology provider aXedras, which focuses on the digitalization, respectively the establishment of a digital standard along the gold value chain.”

Ultimately, this documents the origin of the gold from the mine, through the refinery, to the dealer. Perhaps not today, but in the future, this could be a concept for mine operators and producers to gain higher reputation and competitive advantages and distinguish themselves from less transparent sources.
Through blockchain technology, the exact path can be traced in detail. The goal is that one can scan a gold bar and then, based on its digital fingerprint, know exactly what material it contains and where the gold comes from.

Future of Gold Trading
“It is conceivable to offer such bars in the future in addition to our range of conventional gold bars. Of course, for investors who are willing to pay for this additional effort.”
“We already offer CO2-neutral gold from the traditional Pforzheim company C.HAFNER. However, demand is currently still relatively subdued; unfortunately, hardly anyone is willing to pay more for CO2-neutral gold. So the question is under what conditions such products could actually be in demand.”

Banks might eventually be required to trade only such gold. For instance, because it must be traceable from which sources the gold originates. Furthermore, refineries could additionally prove how much melt gold they add during the bar production of a specific batch. And as a certified custodian, in our case, it would be provable that this gold is located here with us and is traded by us. It’s about the digital twin, the security feature of blockchain technology, with which the entire history with every single step is stored. And that is the digital fingerprint for this bar, which no one can forge.
The Swiss technology group aXedras is one of the providers for the digital recording of gold across the entire supply chain. The impeccable origin of the gold should thereby be provable beyond doubt at any point in time. It is about ensuring sustainable and conflict-free gold production as well as security and transparency in gold trading.

New Technologies
“The acceptance of new technologies requires time and persuasion. But one can imagine a lot here. Another possibility would be to permanently store these bars equipped with a digital certificate, respectively token, and then only trade the right to them. Then no one has to worry about security, while authenticity is verified. Of course, it would then also be possible to have the original bar delivered. And thinking the whole thing further and putting it out there, perhaps that would be a solution for the reintroduction of a gold-backed monetary system?”
“We know from conversations with market participants that there are considerations on the part of national banks to use tokenized gold to re-stabilize trust lost towards banks in a crisis.”
“We already had a similar topic with the question about the Bundesbank’s gold. Is it booked multiple times or even still available? If that is recorded in this system, Bank B knows that Bank A actually possesses the gold. In times of crisis, there would be no more loss of trust between banks, liquidity would be preserved.”
Current Developments and Discussions

How far have these plans progressed?

Markus Osiander, Markus Pieper, ZIEMANN VALOR
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⏰ Published on: August 22, 2023