Aurum - who buys and sells?
79Au197
Posts: 4,047 Gold ✭✭✭✭✭
Something that has been bouncing around in my head for a while. Who buys our gold? Who sells us there gold?
Cf. http://support.bitgold.com/customer/en/portal/articles/1871471-aurum-and-gold-pricing
Since all BitGold users see the same BBO average, who establishes the Best Bids and Best Offers?
Since all of the gold is 100% allocated and segregated in the vaults, where does the deposited gold come from? Where does the gold redeemed for fiat go?
Who buys our gold? Who sells us there gold?
Cf. http://support.bitgold.com/customer/en/portal/articles/1871471-aurum-and-gold-pricing
Since all BitGold users see the same BBO average, who establishes the Best Bids and Best Offers?
Since all of the gold is 100% allocated and segregated in the vaults, where does the deposited gold come from? Where does the gold redeemed for fiat go?
Who buys our gold? Who sells us there gold?
Best Answers
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GrandpaBrian
Posts: 679 Silver ✭✭✭✭
@rohanibuang61 , The BitGold Aurum platform is tied into the major gold markets and it is those markets which set the spot prices for gold. It is likely that the only gold actually owned by GoldMoney Inc is a supply of their cubes to meet redemptions. The cubes may be considered more of a marketing device than a traditional bullion product.
@79Au197 , I believe it is correct to say that the net monthly additions of user gold come from the various bullion dealers around the world, many of whom likely use the same Brinks vaults as BitGold. In a simple case, a kilogram bar might move from one part of the vault to the BitGold part of the vault. -
GrandpaBrian
Posts: 679 Silver ✭✭✭✭
A further thought regarding the physical gold... The number of gold-owning BitGolders will likely increase to several million over the next few years and the average amount of gold per customer will increase markedly. At the same time, the GoldMoney assets under administration will likely double. Therefore, the gold piles in each vault will get bigger. But remember that it doesn't take much space to hold a billion dollars worth of gold!
Answers
"Every gold transaction in your BitGold account is executed at the BBO plus an additional one percent (1%) fee. BitGold provides a price guarantee for any transactions executed from Sunday from 6:30 PM EST to Friday at 5:00 PM EST. This price guarantee maintains that the fee added to the BBO will be one percent (1%) or less. Given that gold trades on a 24/5 schedule, BitGold can only provide a price guarantee during those days. For transactions occurring from Friday at 5:01 PM EST to Sunday at 6:29 PM, the Aurum prices will reflect the internal liquidity provided by the BitGold market making operations".
The other thing we receive gold with BitGold cubes, a trademark of BitGold assets transacting as Gold's Buyer and Seller.
I read that prior to posting. I do not interpret that to indicate that BitGold is the buyer or seller, or at least that BitGold is not establishing the Best Bid or Best Offer.
http://www.thebitgoldfiles.com/#!All-The-Gold-In-The-World/c1q8z/5643b9de0cf2f51f32369e3c
Yes an excellent visual
Buy / sell between BitGold accounts should be then based exclusively on the posted BBO Average then not the Best Bid / Best Offer spread. I do not know if this is the case. @Melanie ?
Click here for a quick explanation!