The cryptocurrency market has seen some major disruptions since early 2018. With stricter rules and closer scrutiny, the trade of digital assets is growing at a more stabilized pace. Popular cryptocurrencies, such as Bitcoin and Ethereum, have seen their values drop as investors have become increasingly concerned about their reliance on peer-to-peer computer transfers and a lack of physical backing. These shortcomings have prompted the cryptocurrency community to innovate, creating new digital assets that avoid the volatility inherent in cryptocurrency trading. One of these new asset classes is gold-backed cryptocurrencies.
Asset-backed cryptocurrencies, or stablecoins, are digital tokens whose values are tethered to a tangible holding. This could be a currency like the U.S. dollar, another digital currency, or an exchange-traded commodity, such as gold. While these hybrid assets are less attractive to risk-hungry investors, they are more stable and experience far less volatility which makes them ideal investments for periods of economic uncertainty.
Today, the majority of stablecoins on the market are dollar-backed assets. USD tethered tokens currently account for 75% of stablecoins’ values, but the market for gold-backed coins is rapidly expanding.
Gold has always been seen as a safe haven in investing. Its stability and value outside of fiat currencies have made it an investor favourite in times of financial turmoil and economic downturns.
The Motley Fool highlights that 90% of the demand for gold is based on its intrinsic value. This is why as part of a larger, diversified investment plan, gold provides value even as other assets struggle. Gold remains strong through economic cycles, as its sheer liquidity is such that anywhere you go, its values is recognized. As the shadow of financial uncertainty continues to grip investor sentiment this year and into 2020, gold-linked assets will continue to grow in demand.
In the case of gold-backed cryptocurrencies, their minimum value will always be pegged to current gold prices. As a coin is equivalent to a gram of gold, your investments will remain valuable even if your gold-backed cryptocurrency fails to take off and capture greater market share. On the other hand, if your gold-backed stablecoin climbs in value, it can far exceed the price of gold, making it both a safe financial haven and a speculative investment.
Popular Gold-Backed Cryptocurrencies
If you are thinking about investing in gold-backed cryptocurrencies, here are some of the most traded gold-backed stablecoins available:
DGX Token – The Digix gold token was launched last year and is now the most popular gold-backed cryptocurrency on the market. The DGX token was developed by Singapore-based DigixDAO and since its launch, has doubled its gold holdings. As it’s tokenized gold, investors can withdraw their tokens with the equivalent amount in gold. DGX can be traded in Kryptono, Ethfinex and Kyber Network among others.
OGC Coin – UAE based OneGram is a sharia-compliant digital asset popular in the Middle East. Gold trading platform GoldGuard is just one backer behind this gold-backed cryptocurrency. Seventy percent of OGC’s revenues are invested into additional gold shares, adding to its value.
ZGC Coin – Chinese ZenGold coin is the first tokenized gold launched in the Metaverse blockchain. This blockchain is considered in close competition to Ethereum and NEO as an environment to develop dApps and smart contracts. Similar to others on this list, one ZGC coin is equivalent to a gram of gold currently being stored at the Shanghai Gold Exchange Vault.
PAX Gold Coin – Lastly, New York-based asset manager Paxos recently launched its own gold-backed cryptocurrency Pax Gold. The stablecoin issuer highlights that PAXG coins can be exchanged for a gram of gold in trusted institutions like Bullion Exchanges in New York.
As the cryptocurrency market matures, stablecoins are enjoying a much more noticeable presence in the digital asset world. New investors seeking to enter the crypto market with reduced risk would be wise to consider gold-backed cryptocurrencies as a way to stabilize their portfolios and as a safe haven in case of severe market downturns. With big players swooping into the stablecoin market like Paxos and OGC, the popularity of gold-backed cryptocurrencies will undoubtedly continue to grow.
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As with any asset, investing in cryptocurrencies involves the risk of substantial loss, including the loss of your entire investment. SolidTrust Pay is not an investment advisor or fiduciary and this content is provided for informational purposes only. Before purchasing cryptocurrency, please evaluate whether the investment is suitable for your financial situation and personal risk tolerance.
The short answer is there isn’t. There will always be a degree of risk inherent in any investment you make. However, with some tips, you can minimize loses and make market volatility work in your favour.
It’s been 10 years since the creation of the world’s first cryptocurrency. What began as an attempt to create a “trust-less” cash system, whereby costly third-party intermediaries would no longer be needed, has grown to include more than 1,600 different cryptocurrencies. Of course, not all cryptocurrencies are equal and the method by which they are created is surprisingly easy, making it possible for anyone with some basic coding knowledge to create their own. It’s believed that only 20 cryptocurrencies account for 89% of the total digital currency market. This means that the vast majority of cryptocurrencies will never have values above a few cents, with many disappearing altogether as more established digital currencies increase their market capitalization.
For many of us, the price volatility of cryptocurrencies discourages us from purchasing them. In less than 4 months, Bitcoin dropped from a high of nearly $20,000 to less than $7,000. This volatility continues to define the cryptocurrency landscape with the value of many altcoins rising and falling as quickly as the ocean’s tides. Despite this instability, not all digital currencies are risky investments. Stablecoins are cryptocurrencies that are secured to an asset with a stable value, such as gold or the U.S. dollar. Notable examples include Tether and Facebook’s new Libra cryptocurrency which will be introduced in early 2020. These coins have a fixed valuation and present themselves as safer investment options than more volatile cryptocurrencies like Bitcoin and Ethereum. Stablecoins are ideal for conducting routine transactions and are quickly growing in popularity among people who live in nations with unstable monetary systems.
Minimize Your Risk With Dollar-Cost Averaging
If you’re like most investors, you want to join the multitude of individuals who are actively buying, selling and trading popular cryptocurrencies, the 20 or so that make up nearly 90% of the digital currency market. Fortunately, there is a simple strategy you can use to reduce potential loses and make the volatility of the cryptocurrency market work to your advantage: dollar-cost averaging. Dollar-cost averaging allows you to build up your assets over time while helping you to avoid making emotionally driven decisions. The strategy is surprisingly easy to use; instead of purchasing all your cryptocurrency at a single point in time, you divide up the total amount of money you would like to invest in digital currencies and make smaller purchases over an extended time period. For example, instead of purchasing $500 of Bitcoin in one day, you would buy $100 worth of Bitcoin every 4 weeks for 5 months, or purchase $50 worth of Bitcoin every 2 weeks for 5 months.
Your $100 investment will purchase more Bitcoin when the market is down and this increases the potential for gains if the market turns around. Likewise, when the market is up, your $100 purchase will buy less Bitcoin which will reduce the risk of loss should the market turn the other way. Dollar-cost averaging has been successfully shown to reduce the risk of buying volatile asset classes. It also helps dissipate the anxiety of committing a significant amount of your capital to a single asset purchase while simultaneously giving you the freedom to reevaluate your investment strategy, opting to invest more or less as time goes on.
Buying Cryptocurrency with SolidTrust Pay
Buying cryptocurrency is easy with SolidTrust Pay. Currently, you can purchase 12 different cryptocurrencies using your STPay e-wallet: Bitcoin, Bitcoin Cash, Bitcoin SV, Ethereum, Ethereum Classic, Binance Coin, Dogecoin, Litecoin, NEO, OmiseGO, Tron and Ripple.
Before you can make your initial cryptocurrency purchase, you must first create a secure SolidTrust Pay account and set up an external cryptocurrency wallet. Popular cryptocurrency wallets include Coinbase, Mycelium and Electrum, but there are dozens of options to choose from. Always research your chosen wallet and make sure that it possesses excellent security features.
Once you’ve created your STPay account and external cryptocurrency wallet, buying digital currency with SolidTrust Pay is fast, easy and most importantly, secure. We have been a leader in the online payment industry since 2006 and our corporate-grade anti-virus and firewall protection is continuously monitored by our network of international security personnel. To buy cryptocurrency with your SolidTrust Pay account, follow these simple steps:
Step 1) Create your SolidTrust Pay account by clicking HERE.
Step 2) Verify your account to the Standard Verified level. For more information about our 4 account verification levels, please click HERE.
Step 3) Set up two-factor authentication (2FA) using your smartphone or desktop/laptop. For detailed instructions, please click HERE.
Step 4) Create a cryptocurrency wallet and connect it to your SolidTrust Pay account. If you are using a desktop application, click HERE for detailed instructions. For smartphone instructions, please click HERE.
Step 5) Deposit the amount you wish to spend on bitcoin into your SolidTrust Pay account using a bank transfer, a credit card or a transfer from another STPay member.
Step 6) Log in to your SolidTrust Pay account and navigate to My Money > Withdraw Funds. Next, click on the Altcoins option.
Step 7) Select the amount of money you would like to withdraw to your bitcoin wallet. It may take up to 24 hours for your deposit to appear in your cryptocurrency wallet.
Steps 1 through 4 only need to be completed once. You will then be able to easily buy bitcoin by following Steps 5, 6 and 7. Once your account has been Standard Verified and connected to a cryptocurrency wallet, you may withdraw up to $2,500 per day from your SolidTrust Pay e-wallet (Bank Verified members may withdraw up to $5,000 every 24 hours).
As with any asset, investing in cryptocurrencies involves the risk of substantial loss, including the loss of your entire investment. SolidTrust Pay is not an investment advisor or fiduciary and this content is provided for informational purposes only. Before purchasing cryptocurrency, please evaluate whether it is suitable for your financial situation and personal risk tolerance.
Nothing is more important than family. Not only your family in Canada, but also your loved ones back home. At SolidTrust Pay we understand that when possible, helping your family financially is tremendously important. That’s why we created Bill Pay, Your Way, our premier cross-border bill payment solution.
Since 2006, SolidTrust Pay has been making cross-border bill payment and money transfers easier for our members. Our comprehensive payment platform takes the stress out of international bill payments. Imagine being able to pay your mom’s phone bill in the Philippines or your spouse’s electricity bill in Mexico with the click of a button from your desktop computer or smartphone. With Bill Pay, Your Way you can!
Quicker, cheaper and safer than sending regular money transfers, Bill Pay, Your Way allows you to pay any family member’s electricity, telephone, internet, cable, water and gas bill directly from your secure online SolidTrust Pay e-wallet. You can instantly fund your e-wallet with a credit card, debit card, bank transfer or even cryptocurrencies, and payments are confirmed with the billing company within 48 hours.
For your recipient, Bill Pay, Your Way removes the cost and burden of travelling to collect money and pay bills. Your family will no longer have to take time off work and endlessly wait in line to pay their bills. As the sender, you retain full control over how your money is spent and you can verify the bill amount before submitting a payment.
There’s no transaction fee for this service and our competitive exchange rates mean that it’s cheaper for you to pay a bill using Bill Pay, Your Way than to send a money transfer. As a bonus, your e-wallet gives you access to our Home Connect program, Canada’s most affordable remittance service, as well as our TrustPoints Rewards program and easy Click2Pay service!
- Access over 600 billing companies in 15 countries. New countries and service providers are continuously being added.
- We don’t charge transaction fees and you’ll always benefit from our highly competitive exchange rates.
- It’s free to sign up and you can pay bills with a credit/debit card, bank transfer or cruptocurrencies.
- Access our popular Home Connect and Click2Pay services directly from your e-wallet.
- For a complete list of account benefits, please click HERE.
If you’re a SolidTrust Pay member, you already have access to Bill Pay, Your Way. Simply login to your account and go to My Money > Pay Your Bills. If you’re not an STPay member, sign up for a free personal account HERE. Once your initial deposit has been confirmed and your account has been verified, you can start paying bills immediately.
Cryptocurrencies have been touted as the wave of the future. Not only do they provide superior security than traditional bank issued debit and credit cards, they protect currency holders from financial interference by governments and tax agencies. As support for these alternative currencies steadily grows, entrepreneurs and financiers are taking notice, investing millions of dollars into blockchain technology and cryptocurrency assets. One such investor is Tesla CEO and cryptocurrency enthusiast, Elon Musk. Musk has spoken in favor of decentralized currencies and envisions a future where they will completely replace our reliance on paper money.
At SolidTrust Pay, we are looking towards the future. That’s why your STPay e-wallet is now fully compatible with Bitcoin. We’ve made Bitcoin deposits easy. Simply add your cryptocurrency wallet to your SolidTrust Pay account and enable two-factor authentication (2FA). You can learn more about setting up 2FA HERE. Your Bitcoin deposit is then instantly converted to U.S. dollars. Read our handy get-started guide HERE.
To withdraw your funds into your virtual wallet, go to My Money > Withdraw Funds > Altcoins. Please ensure that you have enabled 2FA on your account and have added a virtual wallet before proceeding with a cryptocurrency withdrawal. For step-by-step instructions, please click HERE.
What Are Cryptocurrencies?
The most famous cryptocurrency is Bitcoin. At its core, Bitcoin is a form of electronic cash. All cryptocurrencies are decentralized digital assets that are not regulated by a central bank or administrative body. They rely on strong cryptography to secure financial transactions, control the creation of additional units of currency and verify the transfer of assets.
The blockchain is a term often associated with alternative currencies like Bitcoin. However, it’s not a digital asset. Instead, it is a method of creating security. The blockchain can best be thought of as a digital ledger or record book. It is a record of transactions made in Bitcoin or another cryptocurrency (for example: Ethereum, Litecoin or Ripple) maintained across several computers that are linked in a peer-to-peer network. The blockchain represents an entirely new method of record keeping, one that does not rely on a singular point of trust for confirmation.
Please perform due diligence before purchasing alternative currencies. The crytocurrency asset class remains more volatile than any other liquid asset in the marketplace. SolidTrust Pay does not sell Bitcoin, nor do we provide virtual wallets to store your cryptocurrencies. We recommend Coinbase as one option. SolidTrust Pay has no affiliation with Coinbase and we cannot be held responsible for the outcome of Coinbase’s services.
Do you use Bitcoin? Let us know in the comments section below or on our official SolidTrust Pay Facebook page. If you enjoyed this post, please follow us on Facebook and Twitter for news, updates and more great content!