Swiss-based Canadian smart contract platform, Vault, is set to secure funding for the launch of the USDVault token in the coming fall 2018. The new crypto is the first token backed and redeemable for LBMA gold bullions stored within Swiss gold vaults. The token peg is at a ratio of 1:1 through a gold hedging process. The USDVault idea will present a unique offering for individuals and institutional investors within cryptocurrency by using one of the oldest stores of value and currency.
How USDVault Works
Unlike other existing stablecoins, USDVault brings a new kind of stabilization by using the essential form of value, which is gold. Gold held in Swiss vaults are run and managed by licensed fiduciary organizations to oversee the collateral provision. That will enable the USDVault token to provide for a new level of value, unlike other cryptocurrencies.
The Vault platform will provide the technology to issue the USDV tokens to interest investors but will have no access to the gold deposits or the users' funds. All these will be under the licensed fiduciary partners. Once the user satisfies the initial KYC and AML process, they will receive an equivalent of their investment in USDV tokens within their ERC20 wallets.
A statement from Ranjeet Sodhi, a co-founder, reads,
“Gold is unique as an ideal backing for an investment-worthy stablecoin….and is and is resilient to the political and regulatory uncertainty of the banking”
Does USDV Meet The Needs Of Institutional Capital?
The USDVault token approach relies on several compliance measures which makes it's unlike other cryptocurrency models. Its first feature is the ERC20 compliance that makes it's a fully transparent verification and ledger system that uses blockchain infrastructure. As it appears the legal status of the USDVault token is that they are evidence of a deposit giving investors the capability to redeem their coins for $1 or an equivalent of it in gold.
Vault's legal advisor Arjun Ahluwalia explains,
“Our legally compliant fiduciary, escrow, and gold vaulting structure enables us to offer a solution that appeals to institutional investors who have thus far stayed on the sidelines waiting for the market to mature.”
Vault project is a venture looking to develop an advanced, stable coin for investors looking to bypass the barriers of controversy, value, and lack of trust. The startup brings together top talent in technical, financial, legal and cryptocurrency sector to develop institutional-level access to tokenized gold assets.