Altcoin Spotlight: Pax Gold (PAXG)
As economies everywhere continue to struggle, gold purchases are on the rise. So much so, that many cryptocurrency companies have turned to tokenizing gold, which is where Pax Gold comes in.
But what is Pax Gold? And is it worth investing in? Read on to learn everything you need to know about Pax Gold, the tokenized gold asset.
What is Pax Gold?
Pax Gold is a cryptocurrency that is backed by the commodity gold. The token uses the ERC-20 token standards to create a digital manifestation of real gold. The creators of the project say they embarked on this project for the purpose of creating a more easily traded form of gold.
How Does Pax Gold Work?
Pax Gold has a limited supply of tokens, which is based directly on the amount of gold bars the company behind Pax Gold, Paxos, keeps in storage. One Pax Gold token is equivalent to one troy ounce of gold held in the LMBA vaults in London. As such, the price of Pax Gold directly correlates with the market value of an ounce of gold.
Unlike stablecoins and other cryptocurrencies, more Pax Gold is only created when the company purchases more physical gold and adds it to its vault in London. Although more tokens can’t be created on demand, Pax Gold lowers barriers to gold buying as it allows smaller purchase minimums than most other methods of buying gold.
Not only that, but Pax Gold provides customers with a more liquid form of the asset. With gold bars, it can be hard to liquidate at a moment’s notice or for an emergency because you have to find someone willing to buy the gold bars from you. With Paxos Gold, the tokens can be redeemed at any time for USD, and interested investors can request the physical gold bars behind their portion of Pax Gold if they so choose. This gives customers ultimate freedom while owning gold.
The LMBA vault in London is audited monthly based on Paxos reports, ensuring that customers can rest easy knowing that they are truly purchasing a commodity that is 100% backed by a physical asset.
What is PAXG?
PAXG is the market symbol used when trading Pax Gold on various marketplaces. As mentioned above, the value of one PAXG is always equal to the market value of one ounce of troy fine gold.
Who Created Pax Gold?
Pax Gold was created by Paxos, the same company behind the Paxos Standard stablecoin. While the stablecoin was launched in 2018, Pax Gold was launched in 2019. Paxos promotes its company as a tokenization platform.
Charles Cascarilla and Rich Teo are the cofounders, and they founded the company in 2012. Unlike other cryptocurrency companies, the two of them remain in control, and both serve as CEO. Charles is the CEO on the US and EU side, while Rich is the CEO for the Asian side. Current headquarters are in London and Singapore.
Currently, PayPal is a major client of Paxos and uses their platform to sell cryptocurrency on PayPal.com.
Should You Buy Pax Gold?
Paxos Gold isn’t the only cryptocurrency company currently offering a tokenized version of gold. However, in our opinion, they are one of the most trustworthy.
A few weeks ago, we wrote about Tether Gold, and while we don’t trust the company behind Tether for a variety of reasons (lawsuits, past dishonesty), we don’t see the same flaws with Paxos. From what we can tell, Paxos is a law-abiding company that has actually been hired to work with various governments (including the US government) on tokenizing assets.
That being said, an investment in Paxos Gold doesn’t come without risk.
Investing in any asset (yes, even fiat currency) carries inherent risk. While gold is considered a relatively stable asset, that doesn’t mean this will always be the case. You could purchase Pax Gold at one price, only for the price of gold to decline and for you to lose some of the money you invested. Additionally, while we can’t see problems with Paxos’ operating procedures now, this doesn’t mean it will always be the case.
Basically, an investment in gold always carries risk, but if you are interested in investing in tokenized gold, Paxos Gold is definitely one of the better choices, and it is likely what we would use to invest in tokenized gold if we were looking to do so.
Of course, any investment decision is a purely personal decision, and we can’t make them for you. We also recommend running any investment decision by someone you trust with your finances before making them. As with any cryptocurrency investment, ensure you check your local regulations to verify it is legal for you to make the investment you’re planning to make.
Where Can You Buy Pax Gold?
There are many places where you can purchase Pax Gold. In general, the best place for purchasing a cryptocurrency is on a platform where you already have an account, which makes your investment easy and quick. However, if your regular trading platform doesn’t offer Pax Gold, here are some platforms where you can purchase it.
Platforms Where You Can Buy Pax Gold:
· Binance
· Coinbase
· Kraken
· MEXC
· Nexo
· LCX
There are many more platforms that offer the option to purchase Pax Gold; these are simply the most popular.
Overall, there are many cryptocurrency companies looking to move into the space of tokenizing gold, especially with the declining economy. While we can’t say an investment in Paxos Gold is the best, we do think it is one of the better companies in the space. So, if you are looking to purchase a digital form of gold, Paxos Gold is one of your best options. As always, run any investment decision you make by someone you trust before investing. And remember, no investment is ever guaranteed.
