In today’s rapidly-changing and increasingly digital gold ecosystem, it has become inevitable that both suppliers and buyers are greeted by an ever growing number of intermediaries at all stages of the trading process.
The marketplace has undoubtedly become saturated with vast numbers of players, making it difficult for gold suppliers and their customers to trade directly and effectively. Not only has this made the trading process more complex, it has brought with it a greater risk of both parties susceptible to hidden fees when transferring gold throughout the entire supply chain.
This increasingly murky ecosystem has encouraged a growing lack of transparency over the origin of gold, which is leaving many industry players unclear on the exact the route the product had taken on its journey from the source, to the supplier and ultimately to the consumer. However, as competition thickens and the room for fraudulent trading across the ecosystem continues to grow, the need for an unprecedented solution is becoming increasingly imminent.
One technology which now presenting a clear opportunity to tackle these longstanding industry issues is blockchain. The technology has of course been garnering many column inches of late, with its promise of unrivalled security and complete control when trading attracting many industries worldwide.
This value of the global blockchain technology market has also inevitably skyrocketed and is now forecast to hit $2.3 billion by 2021, as companies look to the solution in order to increase trading efficiency, better connect buyers and sellers and eradicate fraud from the process.
These challenges are all too familiar across the gold industry today, yet blockchain now offers great promise for building and delivering a quick and highly scalable transaction processing service to the large number of buyers and sellers in the space. For example, the technology’s ability to provide a full and irrevocable record of all transactions is one of the key components needed to create a secure and transparent trading solution.
It’s this increased level of traceability offered by the blockchain which we are building our very own USAVE ecosystem on, in order to install greater trust for both parties and give them peace of mind over exactly where gold has come from as it both produced and stored around the world. What’s more, the very nature of the blockchain enables us to create an open public system, where all data collected is made publicly available, working to uphold true transparency throughout the entire process, from the miner to the end consumer.
However, blockchain can not only help to connect suppliers and buyers and facilitate more direct trading of gold, it can also help to increase payment security for those operating gold production mines in developing regions. Its ability to eliminate third parties from the process and offer a permanent and fully traceable contract of sale gives mining companies greater confidence in their transactions with buyers, leaving less room for fraud as a result.
Here at USAVE, we are not only using blockchain technology to bridge the traditional gaps between the supplier and buyers, we’re also leveraging its transparent nature to ensure that buyers are provided with gold which has been sourced with the utmost responsibility. While it cannot provide a solution to all of the industry’s inherent challenges on its own, blockchain can prove instrumental for creating a seamless and secure experience for the future of gold trading, helping those involved to meet the highest ethical standards and create a fair marketplace for all parties.