(Kitco News) – Even as gold prices see a pullback, the digital gold market continues to heat up. Argo Digital Gold, a new online gold dealer, announced a strategic investment partnership with Paxos and WonderFi Technologies Inc.
“This collaboration builds upon the strong foundation established by Argo's founding investors, the Sprott family and Peter Grosskopf, further solidifying its position at the forefront of the digital gold revolution,” the company announced in a press release on Wednesday.
Paxos is a blockchain and tokenization infrastructure company and is the issuer of the Pax Gold (PAXG) token, while WonderFi is a Canadian operator of regulated crypto platforms with 1.7 million registered users and $1.5 billion combined assets under custody.
“We are thrilled to close this investment round and welcome both Paxos and WonderFi as strategic investors,” said Michael Petch, President and Co-founder of Argo. “Their expertise and leadership in the digital asset space perfectly complement the vision of our founding investors, the Sprott family and Peter Grosskopf.”
According to the announcement, the investment “signifies strong support to advancing digital gold and Argo's new precious metals platform,” which offers secure digital gold and precious metals trading and storage.
“We are excited to join forces with Argo Digital Gold,” said Dean Skurka, President and CEO of WonderFi. “Argo's innovative platform for secure gold ownership aligns with WonderFi's mission to innovate financial markets. We believe this partnership will be instrumental in making digital gold ownership a mainstream investment option, and we look forward to seeing the company grow.”
Argo said that the strategic investment fuels their mission “to offer world-class access to digital gold and precious metals by leveraging the expertise of their partners in precious metals, digital assets, banking, and custody.”
The official platform launch is scheduled for next month, and the company said this collaboration “positions Argo to offer a unique and secure platform that democratizes access to digital gold ownership.”
Digital gold is gaining significant traction in 2024. On June 25, Berlin-based Swarm Markets announced a novel approach to bringing gold onto the blockchain: issuing a gold-backed non-fungible token (NFT).
According to an X thread posted by Swarm Markets, the firm has launched “fully asset-backed digital gold with NFTs representing ownership, which are fully tradable and can be offered peer-to-peer.”
They attributed the design specifically to the implementation of MiCA, which will put regulatory hurdles in place for asset-reference tokens, including gold-based ones. They noted that the rules laid out in MiCA do not apply to crypto-assets that are unique and not fungible with other crypto-assets, which is why they went the route of issuing gold-backed NFTs.
Each NFT will be fully redeemable for the underlying collateral, with holders able to receive physical delivery as soon as they pass know-your-customer (KYC) and anti-money laundering (AML) checks. Swarm Markets plans to let future token holders decide in which jurisdiction the underlying gold is stored.
And on June 17, Tether, the issuer of USDT, the top stablecoin by market cap, announced the launch of Alloy by Tether, a new asset-backed token that uses Tether Gold (XAU₮) as collateral.
“Alloy by Tether aims to redefine stability in the digital economy by combining the strengths of a stable unit of account with the security and reliability of gold,” Tether said.
The company said Alloy by Tether will eventually contain multiple tokens, the first of which will be aUSD₮, a digital currency designed to track the value of one US dollar.
