Controversial cryptocurrency startup Tether has just announced the launch of a new crypto asset. The latest product from the company that brought the market market US Dollar Tether (USDT) is a supposedly gold-backed digital token.
Tether Gold reportedly backs the tokens with physical gold stored in a Swiss vault. However, given Tether’s lack of transparency over the years, it remains to be seen if anyone will even trust the gold-backed crypto.
Tether Gold Launches on Crypto Networks Tron and Ethereum
According to the project’s whitepaper, each Tether Gold (XAUt) token represents a single ounce of London Good Delivery gold. The custodian company reportedly holds these in a Swiss vault on the behalf of investors.
Given that XAUt tokens are divisible, investors can customise the size of positions they take up. The lowest increment of XAUt is 0.000001.
However, there are minimum purchase amounts. Buyers must take least 50 XAUt, representing 50 fine troy ounces (~$75,000), at a time.

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 whitepaper also details that XAUt holders will have the option to redeem their tokens for physical gold on request. This will take place “at a location of the holder’s choosing in Switzerland“. Alternatively, the post says that the holders can request Tether Gold to sell the bullion on their behalf.
The new digital representation of gold is currently available on both the Ethereum and Tron networks. The whitepaper claims other networks will eventually host the new gold-backed crypto asset too.
Following purchase of XAUt, Tether Gold claims it will arrange for the buying of London Good Delivery gold from a Swiss dealer. An unnamed custodian will then store the bullion for the investor.
Tether Gold aims to bring greater transactional utility to the precious metal. It describes XAUt as a “highly mobile ‘ safe-haven’ asset”.
Wait, Do People Even Trust Tether?
US Dollar Tether has been at the centre of plenty of crypto asset scandals in the past.
Constantly changing banking agreements in previous years, accusations of operating a fractional reserve and USDT being used to hold up the price of Bitcoin, and even Department of Justice investigations into the business should have been enough to put even the most gullible investor off.
However, Tether has, and continues to, thrive. At the time of writing, the market capitalisation of the stablecoin is more than $4.6 billion. Collectively, the market clearly believes in the company and it is currently the fifth most trusted project in the crypto industry.
Even the revelation that USDT has not been backed 100 percent by US dollars in a bank account did not cause an exodus from the Tether market. It, therefore, doesn’t seem a great leap to presume that people will extend the same trust, whether rightly or wrongly, to the company’s new gold-backed crypto venture.

And here it begins @tethergold Direct control over gold physical storage is a key factor, same as having control over your #bitcoin private keys.Competitors usually use 3rd party custodians, but that is an additional opaque layer for customers.Tether XAUt does it better 🦁 https://t.co/BYY2gGCcV6
— Paolo Ardoino (@paoloardoino) January 23, 2020

 
Related Reading: PornHub Now Pays Models In Tether Through Tron Crypto Wallet The post appeared first on NewsBTC.