- Tether Gold to be backed by ‘physical gold’ stored in a Switzerland based vault.
“In response to the growing demand for digital exposure to physical gold, we are proud to announce the launch of TetherGold (XAU₮)!” Tether announced via its official Twitter account.
Tether Gold, the digital asset pegged to physical gold is officially live!
Find full details about the only product among the competition that offers zero custody fees and has direct control over the physical gold storage.https://t.co/8RjDpUQQWO pic.twitter.com/arTgN5n0fs
— tethergold (@tethergold) January 23, 2020
The new stablecoin equates to a London Good Delivery gold bar, which is one troy fine ounce of gold, and can be purchased on Ethereum Blockchain as an ERC-20 and TRON Blockchain as the TRC20. Bitfinex, an affiliated company of Tether, was also included as a place of purchase but has a stipulation of a minimum purchase of $75,000. The gold is owned by TG Commodities Limited, the UK registered bullion merchant, Tether further explained in their release.
Tether also says they have direct control over the gold as it will be stored by a Swiss-based vault that adopted best anti-threat measures and best-in-class security, for safekeeping. Tether also boasted of not charging custodial fees as compared to other competitors.
However, Tether has not fully insured the gold reserves which means that in case something were to go wrong, they would not have to issue refunds to their clients as they pointed out in their Terms and Conditions. Be sure to read them carefully before investing.
Among the advantages of owning the stablecoin would be easy access as Tether Gold is available on two separate chains. There would also be individual ownership as each stablecoin “would represent ownership of one troy fine ounce of physical gold on a specific gold bar.” This gives customers that purchase an easy to way liquidate the gold if they would need to.
Tether will be put on the spot with their latest stable asset release as reports of the USDT tokens being 74% backed with dollars and the case of Bitfinex, its sister company, loaning $850 million USD to the company weighing heavily on its back.