Blockchain 101 Episode 84 – Asset Tokenization – Digix, Gold Backed Token

Gold is an unparalleled safe haven asset. Digix tokens is the gold of digital assets. Abbreviated as DGX, it functions as a safe haven in the crypto world.

How is DGX backed by gold?

It digitizes gold using blockchain.
For example, you want to sell 1 KG of gold bullion. You may choose to cut it up for sale. However, it is tedious and it might damage the gold.

Alternatively, you may ship the 1 kg of gold to Singapore for authentication by London Bullion Market Association (LBMA).

A certificate attesting to ownership will be issued upon successful authentication. It can be converted into 1,000 DGX tokens, where 1 token = 1 gram of gold. This greatly increases the liquidity of gold.

Similarly, if you need to redeem the gold, all you need is to use the tokens, to exchange for the certificate to redeem the gold.