Gold and Bitcoin

[Peter90]

"On the Kinesis Exchange, you can purchase as little as 0.00001 KAU and 0.00001 KAG"

Today 1 gram of gold = 66 $
0.00001 = 0,00066 $
The minimum amount requested to buy physical gold through Kinesis is 0,00066 $

On one hand it's a great solution - a minimum entry threshold, allowing even low-income people to stock up a little at a time. This is very important for countries where the population does not have large incomes and is not able to immediately buy 10-100 grams of gold as an investment asset.

On the other hand, for example, I and my family bought 1 gram of gold and.... decided to turn it into real bullion and take it home. Yes I know that refineries produce bank bars from 1, 2, 2.5, 5 grams and then in multiples of 10. But I assume that Kinesis assets are most likely in large ingots, from 100 grams, which is easier, more convenient and cheaper to store.

Question - is there a minimum milestone for "withdrawal" of gold bought in the Kinesis network?

Hi doc
from the Tether Gold thread

6) Kinesis minimum redemption
Gold: 100 grams
Silver: 200 ounces
"Kinesis enables users to redeem as little as 100 grams of gold or 200 ounces of silver, with a fee of 0.45% + $100 USD + delivery costs."

Just as a comparison:
Tether Gold minimum redemption = 13,3 kilograms



Now it's my turn to ask: that 1 gram of gold that you bought, can you remember how much premium did you pay? More or less?

Premium is the difference between spot price (the official, international price) and the price that you actually pay to the seller.
For ex. this is today Bullionstar, a very good vendor based in Singapore

[DrBeer]

Hi doc
from the Tether Gold thread

6) Kinesis minimum redemption
Gold: 100 grams
Silver: 200 ounces
"Kinesis enables users to redeem as little as 100 grams of gold or 200 ounces of silver, with a fee of 0.45% + $100 USD + delivery costs."

Just as a comparison:
Tether Gold minimum redemption = 13,3 kilograms



Now it's my turn to ask: that 1 gram of gold that you bought, can you remember how much premium did you pay? More or less?

Premium is the difference between spot price (the official, international price) and the price that you actually pay to the seller.
For ex. this is today Bullionstar, a very good vendor based in Singapore
....

Hi Peter !
Thanks for your reply ! One issue that concerns me here is the volume of the minimum redemption is 100g, this at today's world market prices is about $6548 ($65.48 / gram). +100 dollars = 6648 Dollars. For people with a small income, and partially spend their income to buy these tokens (gold), according to your assumption - how long will it take until they can take 100 grams of gold ?

And by itself I answer your question: if I got it right, honestly - I can't say. Yes, I have bank bars, though not 100 grams, but I have I bought in banks, several times "for the future", and frankly speaking I was not interested in this "difference"

[Peter90]

Hi Peter !
Thanks for your reply ! One issue that concerns me here is the volume of the minimum redemption is 100g, this at today's world market prices is about $6548 ($65.48 / gram). +100 dollars = 6648 Dollars. For people with a small income, and partially spend their income to buy these tokens (gold), according to your assumption - how long will it take until they can take 100 grams of gold ?

Good morning doc
Gold-backed stablecoins companies are not in the business of selling & shipping gold bars.
They don't aim to compete with bullion sellers (like Bullionstar) or local coin shops.
Stablecoins' users and investors redeeming coins is obviously an exception.
People don't buy gold-backed cryptos in order to bring home some piece of gold.
So if someone wants to buy and bring home some piece of gold gold-backed SC are not the natural way.

[DrBeer]

Hi Peter !
Thanks for your reply ! One issue that concerns me here is the volume of the minimum redemption is 100g, this at today's world market prices is about $6548 ($65.48 / gram). +100 dollars = 6648 Dollars. For people with a small income, and partially spend their income to buy these tokens (gold), according to your assumption - how long will it take until they can take 100 grams of gold ?

Good morning doc
Gold-backed stablecoins companies are not in the business of selling & shipping gold bars.
They don't aim to compete with bullion sellers (like Bullionstar) or local coin shops.
Stablecoins' users and investors redeeming coins is obviously an exception.
People don't buy gold-backed cryptos in order to bring home some piece of gold.
So if someone wants to buy and bring home some piece of gold gold-backed SC are not the natural way.

Hi Peter !
I heard you. Then the question is: what is the key goal of the project ?
Look, it turns out as follows: the population was given the opportunity through some convenient and accessible mechanism, to make some savings of their funds, and what is important - even increase their income, through the purchase of a minimum amount of gold. Great. But to get this accumulation, you can only under certain conditions - it is the withdrawal of savings, with a volume of 100 grams.

I will simulate the situation, of course, I warn you right away, I specially "distort" some indicators.
For example, the average income of the head of the family - 500 dollars (in terms of local currency). He has a family that he supports. Children are growing up, his wife brings up the children, his parents are still "on the balance sheet". He puts aside 50 dollars every month to buy gold in this system. I.e. 450 dollars remains in the family's budget and the prospect of benefiting from investing in gold.
According to my estimates - it turns out, in this scheme, he will be able to withdraw, sell and get fiat currency FOR LIFE, somewhere in: $6548 / 50 = 131 months or almost 11 years. Taking into account the commission and the cost of withdrawal - 11 years and 3 months. Until then, he CANNOT get his funds.  And he will get the amount equivalent to the value of gold in DOLLAR at that time (the gold market is valued in dollars). Here is the math problem - is it exactly profitable, or have I not understood how the system works ?

[Peter90]

And by itself I answer your question: if I got it right, honestly - I can't say. Yes, I have bank bars, though not 100 grams, but I have I bought in banks, several times "for the future", and frankly speaking I was not interested in this "difference"

You rich man you 

Premium is the difference between the value of the gold item (= spot price, official, international price) and the price paid to the seller.
Usually, the smaller the gold item, the higher (in percentage) the premium.
Since gold-backed SC companies buy standard investment size bars (400 ounces = 12,5 kg) users can buy their SC at spot. No premium.

But you must consider not only the buying but also the selling moment.
Here too gold-backed SC offer an advantage vs. gold dealers (and banks... local coin shops... etc): when you go to sell your gold item, the gold dealer won’t pay you at spot. Usually they pay you under spot.
Instead, when you convert your gold stablecoin into fiat, you get the spot price.

So if the premium you paid was, say, 10% (not unusual), deploying the same amount of money through a gold-backed SC you’d own now 10% more gold.
On a 1g bar, that’s... 1 decigram more 

[DrBeer]

And by itself I answer your question: if I got it right, honestly - I can't say. Yes, I have bank bars, though not 100 grams, but I have I bought in banks, several times "for the future", and frankly speaking I was not interested in this "difference"

You rich man you 

Premium is the difference between the value of the gold item (= spot price, official, international price) and the price paid to the seller.
Usually, the smaller the gold item, the higher (in percentage) the premium.
Since gold-backed SC companies buy standard investment size bars (400 ounces = 12,5 kg) users can buy their SC at spot. No premium.

But you must consider not only the buying but also the selling moment.
Here too gold-backed SC offer an advantage vs. gold dealers (and banks... local coin shops... etc): when you go to sell your gold item, the gold dealer won’t pay you at spot. Usually they pay you under spot.
Instead, when you convert your gold stablecoin into fiat, you get the spot price.

So if the premium you paid was, say, 10% (not unusual), deploying the same amount of money through a gold-backed SC you’d own now 10% more gold.
On a 1g bar, that’s... 1 decigram more 

It is more correct to say that I am not rich, but I managed to become richer after I converted unnecessary spending into investments, which I wish everyone !

And thank you for describing everything in such detail, I can say - not everyone understands this scheme.

Well and as a result, to the last phrase, there is a saying, I do not know how accurately I can convey the meaning, but it is very useful I will try to adapt "a cent - a dollar saves"

[yohananaomi]

It is more correct to say that I am not rich, but I managed to become richer after I converted unnecessary spending into investments, which I wish everyone !

And thank you for describing everything in such detail, I can say - not everyone understands this scheme.

Well and as a result, to the last phrase, there is a saying, I do not know how accurately I can convey the meaning, but it is very useful I will try to adapt "a cent - a dollar saves"

Saving from what is not needed and saving in the form of investment is certainly something that is very appropriate. It's easy to say but not easy in practice to make savings that can be invested. All of this, in time, will be able to provide added value to the life you live. Of course, you could, as you say, "succeed in becoming richer.".

[DrBeer]

It is more correct to say that I am not rich, but I managed to become richer after I converted unnecessary spending into investments, which I wish everyone !

And thank you for describing everything in such detail, I can say - not everyone understands this scheme.

Well and as a result, to the last phrase, there is a saying, I do not know how accurately I can convey the meaning, but it is very useful I will try to adapt "a cent - a dollar saves"

Saving from what is not needed and saving in the form of investment is certainly something that is very appropriate. It's easy to say but not easy in practice to make savings that can be invested. All of this, in time, will be able to provide added value to the life you live. Of course, you could, as you say, "succeed in becoming richer.".

There is a simple but very capacious proverb: saved money - means earned money ! I don't know if I was able to convey the thought correctly in English, but I think the general meaning is clear.

It's really simple. Just need to accustom yourself to some simple rules, one of the key: keep records of income and expenses, analyze the data. Believe me, I was able to make myself stick to this rule not from the first time
But then, when I saw my statistics for the first month, I realized that a noticeable part of the costs can be either reduced or reduced to 0.  And to reward myself - the money saved, as one of the options, to invest in my future. This is also about cryptocurrency

[Peter90]

By the way, I had an interesting thought. Let's imagine that 5 years have passed, for example, the world has accepted cryptocurrency, and let's assume that it has replaced fiat currency. I.e. cryptocurrency has replaced dollars, rupees, yuan and other euros Let's call it for example BitcoinWorldCoin.

As we understand from classical world economics - a currency with constant deflation is NOT good for the economy. I will not describe why, we can put it in a separate topic, as it requires a lot of explanations. But for interest you can ask your economists, they will confirm this idea.
What is going on?  The world is forced to find ways to stabilize the "price" of BitcoinWorldCoin. And what happens ? That's right - BitcoinMicroCoin, becomes unattractive from an investment point of view. And loses its appeal. Yes, as a means of accumulation and savings - it will still be in demand among ordinary people, but large investors will leave it - why do they need something that is stable in price. Another option - Bitcoin World Coin still has an inflationary component, contrary to the essence of Bitcoin World Coin replacement of other currencies.
In both the first and the second scenario investment attractive will be ... GOLD !

Your opinion ?

My opinion is that you really don't like your national currency as you constantly phantasise about replacing fiat currencies with cryptocurrencies   

I'm not enough sophisticated to be able to say something meaningful to your question.
The first thing I do is to keep separated the money/currency from the investment part, otherwise it becomes too complicated 
I'm more interested in the money part, because sound money for a society is more important than good investments.

People - ordinary people - need sound money i.e. a currency that keep its purchasing power over time and don't change it.
Stability is the opposite both of inflation and of deflation.

10 years ago 5 apples costed 1 €
Last year 5 apples costed 1 €
Today 5 apples cost 1 €
Next year 5 apples will cost 1 €
In 10 years 5 apples will cost 1 €

People need "sound" money. Good money. A store of value.
People need stability, predictability.

We are not talking about investments, we are talking about money.
History shows that the the most stable currency is gold.

Gold per se is not an investment, it is money. It becomes an investment only within an unhealthy monetary environment where fiat currencies loose purchasing power.
It's like the Swiss franc: the chf is not an investment, it's a fiat currency, but people around the world - particularly in Europe - "invest" in Swiss francs because their national currencies loose purchasing power.

[DrBeer]

By the way, I had an interesting thought. Let's imagine that 5 years have passed, for example, the world has accepted cryptocurrency, and let's assume that it has replaced fiat currency. I.e. cryptocurrency has replaced dollars, rupees, yuan and other euros Let's call it for example BitcoinWorldCoin.

As we understand from classical world economics - a currency with constant deflation is NOT good for the economy. I will not describe why, we can put it in a separate topic, as it requires a lot of explanations. But for interest you can ask your economists, they will confirm this idea.
What is going on?  The world is forced to find ways to stabilize the "price" of BitcoinWorldCoin. And what happens ? That's right - BitcoinMicroCoin, becomes unattractive from an investment point of view. And loses its appeal. Yes, as a means of accumulation and savings - it will still be in demand among ordinary people, but large investors will leave it - why do they need something that is stable in price. Another option - Bitcoin World Coin still has an inflationary component, contrary to the essence of Bitcoin World Coin replacement of other currencies.
In both the first and the second scenario investment attractive will be ... GOLD !

Your opinion ?

My opinion is that you really don't like your national currency as you constantly phantasise about replacing fiat currencies with cryptocurrencies   

I'm not enough sophisticated to be able to say something meaningful to your question.
The first thing I do is to keep separated the money/currency from the investment part, otherwise it becomes too complicated 
I'm more interested in the money part, because sound money for a society is more important than good investments.

People - ordinary people - need sound money i.e. a currency that keep its purchasing power over time and don't change it.
Stability is the opposite both of inflation and of deflation.

10 years ago 5 apples costed 1 €
Last year 5 apples costed 1 €
Today 5 apples cost 1 €
Next year 5 apples will cost 1 €
In 10 years 5 apples will cost 1 €

People need "sound" money. Good money. A store of value.
People need stability, predictability.

We are not talking about investments, we are talking about money.
History shows that the the most stable currency is gold.

Gold per se is not an investment, it is money. It becomes an investment only within an unhealthy monetary environment where fiat currencies loose purchasing power.
It's like the Swiss franc: the chf is not an investment, it's a fiat currency, but people around the world - particularly in Europe - "invest" in Swiss francs because their national currencies loose purchasing power.

The first sentence is absolutely true..... Only in reverse
I just do not see cryptocurrencies as a substitute for fiat currencies, in the conditions of the modern financial and economic model of the world.

Regarding the rest:

Gold. Yes, it is one of the pillars of banking, financial systems. It is used as a gold and foreign currency reserve by whole countries, it is bought and stored by people who have "extra" money, it is used to save money. Gold is actually constantly rising in price. By the way, a question - have you tried to compare the graph of gold price and dollar inflation?
PS. Yes and I have it too

Swiss franc. Here I would add the dollar, the Euro, and some other less popular currencies.  Oh, and my "financial cushion" is multi-currency. Local currency is for everyday spending, currencies are to protect a part of paper local money from inflation, although I know that the above currencies are subject to inflation. But much less than my country's currency AT THIS MOMENT. Here I emphasize - in the times when my country lived in the world, I had currency reserves for the most part - for traveling around the world - the dollar is accepted and exchanged everywhere

Cryptocurrencies. It's a "new instrument" in the financial market, speculative, which means you can make money on it. And it also appeared in my "stocks".

So I do not reject anything that can bring additional income


And about "stable money". The problem is that stable money, is not very useful for the economy. The problem with "stable money" is that it stops the development of the economy, investment.... The essence of the problem, very simplistically - Why invest / develop or build a business (which saves from controlled small inflation), if nothing will happen with money !?
Well and as I have said many times - in 99.9% of additional issue modern states cannot exist. We can discuss this theorem

[tjtonmoy]

If you mention gold in a public space, I believe that 100% of people in that place will actually know what gold is, and they know that gold is a valuable asset that can be traded for real money, but if you mention bitcoin in the same public space, only about 80% of people or less will know what bitcoin really is. Some of those people may have heard about Bitcoin but may not have the proper knowledge about Bitcoin.

I want to add that amongst those 80% there will be most people who only know about the negative side of Bitcoin because that's how the government portray Bitocin to the public. And those people think that the government is right and Bitcoin is the enemy of humanity.
And this is the matrix we are in right now.

So, my question is, for those of you that actually have good knowledge about Bitcoin and gold, which will you love to invest in, and what is your reason for choosing the asset?

Why not both? I will consider choosing both because both of them provide us with great opportunities. One is slow but the profit is almost guaranteed and the market is not that much volatile. And other is volatile for sure but also gives us great profit in the long run.
Gold is the safest bet if you want a slow but steady profit. And BTC is volatile and that makes it a bit risky but also profitable because we can take advantage of its volatility.

[Peter90]

And about "stable money". The problem is that stable money, is not very useful for the economy. The problem with "stable money" is that it stops the development of the economy, investment.... The essence of the problem, very simplistically - Why invest / develop or build a business (which saves from controlled small inflation), if nothing will happen with money !?

Stable money is a currency whose purchasing power is stable.
This is mostly useful for the life of ordinary people and hence for the economy.
The reason why BTC isn't used yet as everyday money is because of its volatility i.e. its instability.

This 5 years chart compares gold with BTC



Ordinary people and businesses don't want to carry the risks connected to volatility.
When they receive money - when they get paid for something they did or sold etc... - they want to become neither speculators nor investors.
They just want to get paid and they want to know what that amount of money will be able to purchase next week, next month, next year...
They prefer predictability to the chance of big gains.
They need that kind of financial security.
This is what gold offers, this is what BTC doesn't offer.

BTC offers the chance of increasing money i.e. BTC is a good investment, but functioning as a good investment doesn't necessarily imply functioning as good money.

[DrBeer]

And about "stable money". The problem is that stable money, is not very useful for the economy. The problem with "stable money" is that it stops the development of the economy, investment.... The essence of the problem, very simplistically - Why invest / develop or build a business (which saves from controlled small inflation), if nothing will happen with money !?

Stable money is a currency whose purchasing power is stable.
This is mostly useful for the life of ordinary people and hence for the economy.
The reason why BTC isn't used yet as everyday money is because of its volatility i.e. its instability.

This 5 years chart compares gold with BTC



Ordinary people and businesses don't want to carry the risks connected to volatility.
When they receive money - when they get paid for something they did or sold etc... - they want to become neither speculators nor investors.
They just want to get paid and they want to know what that amount of money will be able to purchase next week, next month, next year...
They prefer predictability to the chance of big gains.
They need that kind of financial security.
This is what gold offers, this is what BTC doesn't offer.

BTC offers the chance of increasing money i.e. BTC is a good investment, but functioning as a good investment doesn't necessarily imply functioning as good money.

I partially agree - people want stability, pensions and health care, but they also want to pay less in taxes and get more
But people do not realize that the state is not a printing press, all they get is taxes. And they are not always enough, and sometimes there are other problems - pandemics, natural disasters, .... And the state is forced to make additional emission to help the population that "wants stability".  So a little inflation is not a bad indicator, plus I'll drown again - inflation motivates people to invest in development to cover inflation.

And regarding the volatility of cryptocurrencies - yes, I completely agree here, and for a long time I consider this problem one of the key issues for the average person who uses cryptocurrencies. And for any economy - such volatility is also a nightmare, which will be another argument in favor of the idea that classic cryptocurrencies and/or bitcoin can replace fiat currencies.

[dekafee79]

I want to add that amongst those 80% there will be most people who only know about the negative side of Bitcoin because that's how the government portray Bitocin to the public. And those people think that the government is right and Bitcoin is the enemy of humanity.
And this is the matrix we are in right now.

Yeah mate,
That's been on the minds of almost everyone in the world, friends, they've only heard something bad about bitcoin and crypto.There has been a lot of negative information since Bitcoin was launched.  Governments in several countries are also against bitcoin, banning bitcoin which causes their citizens to be hesitant and afraid to invest in bitcoin.

[tjtonmoy]

I want to add that amongst those 80% there will be most people who only know about the negative side of Bitcoin because that's how the government portray Bitocin to the public. And those people think that the government is right and Bitcoin is the enemy of humanity.
And this is the matrix we are in right now.

Yeah mate,
That's been on the minds of almost everyone in the world, friends, they've only heard something bad about bitcoin and crypto.There has been a lot of negative information since Bitcoin was launched.  Governments in several countries are also against bitcoin, banning bitcoin which causes their citizens to be hesitant and afraid to invest in bitcoin.

Sometimes having too much knowledge or the right knowledge could be a curse. Because people around you are so much in the matrix already, you can't take them out of it and teach them what the reality or the truth is. It is so easy to make people believe is something these days. And the government knows it very well. They use that to control the people.
And when the masses are adopting the same idea, you become the crazy person because you know the truth and oppose them.
But people one day will come to know the truth. Hopefully that day, they don't forget the "crazy" person.