Gold on Ethereum blockchain
In the beginning people were trading items inbetween, without indicative value for each item, since there were no money involved and items could be valued just through other items. You could exchange what you had for things that you are in need for. Of course, sometimes you had items that you need, but did not had items that you can exchange for that, because other side wanted items that you do not have. Based on that, money is created. First coins were made from precious metals, gold, silver and bronze, and were valued based on the quantity that were needed to create coins. Each kingdom had their own coins, usually with an emblem of king/dynasty on it, and were valued in the area under control. Even than there was inflation which could change the value of coins, based on a strenght of the kingdom at the moment, since problems in the kingdom could influence the production of coins, in a way to change the percentage of precious metals in a coins.
Situation in roman empire worsed in a moment when they had issues with precious metals quantity and they started to decrease percentage of silver in their coins, which were delivered to army. Soldeirs could not bought same items with their pay anymore, due to decreasing in value of the coins that were received, and in the long run, roman empire lost their army strenght and vanished afterwards. It is important to have in mind that trust in the coins is in solid connection with trust in the coins production and quantity of precious metals involved in the production. Nowadays, coins are rarely manufactured for exchange, since there is a paper money, and digital money, which will eventually replace paper money. Digital money produced on the blockchain secure trustless mechanism, due to transparency and easily recognizable criterias for the blockchain.
Digital money, or cryptocurrencies, made their entrance to global financial markets ten years ago with Bitcoin introduction and are changing the financial ecosystem since then. Bitcoin introduced number of cryptocurrency, known as altcoins, that are covering nearly all possible applications, but are still not lived up to mass adoption. One of the obstacles to mass adoption is their value volatility, that is a big hurdle to use it as payment methods, and also difficulties to exchange cryptocurrencies to fiat, which is still problematic and unregulated. There are two types of cryptocurrencies currently that are trying to resolve volatility issues, one is stablecoin pegged to one or basket of currencies and other is stablecoin secured by precious metals value. Coins pegged to precious metals, gold for example, could be seen as digital gold, which is easier for manipulation than physical gold, that is also not trading, trading gold is usual through exchange of value, and gold is in treasury.
Digital Gold https://gold.storage/en/home is a project, that is self-funded, that aim to provide stable-coin pegged to Gold, but also with collateral in Gold, in their reserves. Gold token is based on ERC-20 protocol on Ethereum blockchain and provide all advantages of blockchain. One Gold token is equivalent of 1 gram of gold, with 99,99% purity, with current circulation of 9200 tokens covered with 9,2 kgs of Gold in their vault, which can be audited on the website https://gold.storage/en/audits.
Author: https://bitcointalk.org/index.php?action=profile;u=1573369