Many investors want to get into cryptocurrency but don’t know where to start. Bitcoin seems to have peaked, and its volatility makes it a poor candidate for an alternative form of cash. The same issues plague Ethereum and Litecoin.
As many as 30 altcoins come onto the market each day as initial coin offerings (ICOs). Investors new to the crypto world are rightly skeptical about some of these altcoins. They seem similar to long-shot penny stocks.
For many altcoins, the issuers are tech entrepreneurs raising cash for a project. A few of these projects may succeed and make investors some money, but, like penny stocks, most will fade, leaving investors to tally their losses. From an investor’s perspective, these types of ICOs lack the solid backing needed for ensured success.
What if an ICO was backed by $900 million in solid gold?
For any potential crypto investor, backing that strong changes the calculus completely. Now, instead of looking at that ICO as a speculative endeavor, investors can look at it as a strong, long-term addition to their portfolios, one that is based on the innovations of the blockchain technology that is fast coming to the forefront of finance.
The new Karatgold Coin cryptocurrency, issued in March by Karatbars International, a gold investment company based in Stuttgart, Germany, was created to provide investors with a cryptocurrency backed by the power of gold’s stable value. Holders of Karatgold Coin have the right to trade their crypto for gold, just like people had the right to trade dollars for gold during the days of the gold standard.
To create a sufficient gold reserve, Karatbars obtained $900 million in gold through its joint partnership for a gold mine in Madagascar. With this new gold standard in place, Karatgold Coin has the price stability to make it practical as an alternative currency, unlike bitcoin. Holders of the coin are also provided with an easy to use payment system that employs smart contract technology. As a result, Karatgold Coin’s value rises as its popularity increases and with the price of gold.
The coin’s creators understand that gold functions as a natural hedge against inflation. In an age where formerly strong currencies have fallen into fiat currency status, inflation has become a central risk to all investors. Investment strategies that focus only on gaining more currency are doomed to devaluation.
All investors must prepare for inflation and hedge currency risk through the acquisition of commodities. Of all commodities, gold provides the most growth and stability. It has been the standard of value across the world for millennia.
Today’s world bears no exception. In recent decades, gold has continually risen in value, in both bad times and good. During economic catastrophe, like the 2008-2009 recession, gold’s value rose because investors knew it was a safe place to store value. As the worldwide economic system recovered in the decade after, gold continued to rise in value as investors sought to diversify holdings into an asset they could rely upon, especially as fiat currency inflation damaged the value of their holdings.
Karatbars International CEO Harald Seiz founded his company with the vision of bringing gold to all investors as a vehicle for building wealth, security, and independence. The concept has worked enormously well, with Karatbars growing to a 100 million Euro company in just seven years. As Mr. Seiz explains, „Every single person should have the opportunity to buy gold in order to build up assets and ensure their security in a crisis-proof manner.