Karatbars: From Gold to Currency

Karatbars - From Gold to Currency

With Karatbars and the KaratGold Coin, Harald Seiz has realized his vision of a future-oriented currency. As Managing Director of Karatbars, he and his partners Josip Heit and Ovidiu Toma lead an international team that has set themselves the goal of nothing less but a financial revolution. With the creation of the KaratGold Coin, the historically first crypto currency backed up by physical gold reserves, the entrepreneur combines the resilience of the world’s most sought-after precious metal with one of the most important recent technologies. The ambitions that drove Harald Seiz when he founded Karatbars in 2011 haven’t changed over the course of years: Enabling people so they reach financial security and independence.

With more than 500,000 members, the Karatbars community is growing rapidly and now spans across all continents. But what are the reasons for thousands of years of fascination for gold? What are its advantages over today’s bank notes?

Gold as Currency: Impeccable Advantages

In contrast to today’s money, gold historically was one of the first currencies with a global presence and was able to assert itself over thousands of years. Thanks to its rarity and imposing appearance, gold has always been an object of desire for the rich and beautiful in societies. It comes as no surprise that Croesus very early established gold coins as a means of payment around the 6th century BC. Their durability and sturdiness as well as the weight were convincing criteria gold coins serving as the primary choice of payment for almost two and a half thousand years after their introduction.

Golden Medieval Times

What had been an advantage for the longest time turned into a disadvantage when humanity reached middle age: Due to its high weight, it was difficult to make larger gold payments on an international level with it. Transport costs, security concerns as well as the time factor favoured the idea of bank notes. Since goldsmiths were often paid to check the authenticity of gold, they traditionally had secure storage facilities for the valuable commodity. Many gold owners also wanted the same level of security, so more and more of them began to also store their gold in those safe spaces. Once it got stored, the owners received receipts issued for the amount deposited, which turned into unofficial means of payment in daily life. Due to the secure values they stood for, the receipts were widely accepted and could easily be passed on to third parties. Goldsmiths thus functioned as precursors of today’s central banks. At that time, the promissory notes that served as currency were still one hundred per cent backed up by gold reserves.

Introduction of the US dollar and gold in the world trading system

Although the first deposit standard was based on silver, the turning point in the history of gold as dominant currency was the introduction of the US dollar in 1785. Back then and as a result of the famous Coinage Act, it was fully backed by gold so that everyone would be able to exchange their dollars for gold. Thanks to its weight and value, gold as the most expensive precious metal was easy to store.

Fiat Currencies versus Gold: Comparatively Young History

The financial success of the US dollar caused many countries to build up dollar reserves in order to back up their own currencies. In consequence, the amount of dollar bank notes circulating abroad rose quickly. However, when after the second world war the US economy started to stumble, other countries lost confidence. Many foreign governments exchanged their dollars into gold. To avoid illiquidity, president Richard Nixon eventually lifted the exchange guarantee between US dollar and gold in 1971. Many other nations followed his example and introduced the paper money standard instead. The decision marked the end of the gold standard in its original form and allowed countries to increase national debt and inflation by increasing the number of circulating bank notes. The abandonment of the gold standard today is seen as a turning point in the history of world economy.

Karatbars: The Safe Exit from Paper Money

With Karatbars, visionary Harald Seiz takes an unconventional path that challenges the global finance industry: Rather than relying on the stability of paper currencies, he and his business partners Josip Heit and Ovidiu Toma created the KaratGold Coin, the first digital currency with a gold standard. By leveraging innovative technologies such as K-Merchant and the K1 Impulse Phone, Karatbars is gradually creating an ecosystem that enables people to become independent from financial institutions and fragile paper money.

Karatgold Coin: Understanding Harald Seize’s “The Future of Money Theory”

Over the last year, we’ve seen the rise in cryptocurrency or digital cash. Cryptocurrency is an electronic cash system people can use to purchase and sell merchandise and services. Just like you would with physical cash, you would send and receive money via a peer-to-peer network that has no central authority.

Many believe that cryptocurrency and the processes of an electronic cash system is the way of the future when talking about money. Harald Seiz is one of those believers.

In his latest book, “The Future of Money,” Seiz expands on his theory of how we know money today will eventually become obsolete. If we do not find a new method, what will we do?

The issue we face is that money loses value. We’ve seen it time, and time again as the market fluctuates, crashes, builds itself up again, before heading in another downward spiral. The first notable market crash was the infamous Dirty Thirties, or the Great Depression, which latest for over a decade. Once again, in 1987, the market crash on “Black Monday the 2nd.”

One of the most memorable crashes in recent history is the “Great Recession” crash of 2008. The United States financial sector almost came to a complete collapse during 2008 and 2009.

Seiz notes in his book that the financial market gives us a false sense of security. With so many factors influencing the market, the future of money has a grim look to it. It is too unstable for the world to continue to rely on.

“The first signs are unmistakable and already perceptible in the present,” warns Harald Seiz on the condition of the financial market.

However, Seiz has come up with a solution that is accessible to everyone, everywhere.

Harald took his company, Karatbars International, who is in the mining and metals industry, and put the attention on gold. Typically, you could only purchase gold in 100 g bars that were too expensive for most people. Seiz figured that if we broke down gold into smaller bars and coins, it would be more accessible to everyone around the world.

“Financial stability promotes peace in the world. Therefore, it is our goal to provide this basis and to make the solvency of mankind independent from politics,” Seiz explains.