Tokenised financial assets exchange Mesh.trade has announced the launch of Bullion Krugerrand Tokens issued by Troygold on its platform.
Troygold’s Krugerrand tokens on Mesh represent physical gold holdings, which are stored in Brink’s in Johannesburg, which it said is a globally recognised secure vaulting facility.
By tokenising the Krugerrands, Mesh.trade allows investors to buy fractions of a whole ounce (oz) coin, starting from a minimum investment threshold of R50.
Whenever you buy or sell a Troygold Krugerrand token on the Mesh platform, a Gold Ownership Certificate is generated, which you can download from your account.
The Gold Ownership Certificate confirms how much gold you own, fractionalised to 7 decimal points.
“All Troygold’s customers’ gold holdings are fully allocated, meaning you are buying either a whole or a fraction of an actual gold bullion Krugerrand,” Troygold and Mesh stated.
“Even if you purchase a fraction of a 1oz coin, you are allocated as a co-owner of a gold bullion Krugerrand coin securely vaulted at Brink’s.”
The companies said customers can download audited monthly attestations of reserves detailing the number of Krugerrand coins allocated to Mesh clients in the shared RMB and Troygold vault at Brink’s.
“All customer holdings are fully insured against loss or theft by Lloyds of London — the world’s leading specialist insurance provider and market,” Troygold said.
“As part of Troygold’s commitment to safety, only the vaulting custodian has physical access to the vault holdings. Thus, no Troygold or Mesh employee can enter the vault or access the holdings.”
Customers can redeem their tokens on Mesh.trade for physical Krugerrands at any time, with a redemption minimum of a 1-ounce gold bullion Krugerrand coin.
Once investors have accumulated a full ounce (31.1 grams) of gold, they can continue to vault their Krugerrand coin at Brink’s or notify Mesh that they want to redeem it.
Mesh will send the redemption request to Troygold, which will contact the customer directly to arrange for secure delivery of the Krugerrands to their home.
“There may be associated costs, such as shipping or administrative fees, and procedural steps, including identity verification and compliance checks, before you can take physical delivery,” Troygold stated.
Regarding fees, Troygold explained that a storage and insurance fee for physical gold storage at Brink’s for two years will be payable upfront.
“This fee will be calculated and added at the time of settlement at 1.2% of the committed token value,” it said.
When the vaulting fee expires, customers will have two options. Firstly, they can opt to receive an invoice from Troygold to extend their vaulting fee via Mesh.
Alternatively, customers can choose to sell a portion of a token they hold to cover the extension of the vaulting fee.
“If you choose this option, you should be aware that your gold holdings will be reduced by the amount payable for this fee,” Troygold said.
Ownership and control
MyBroadband asked Mesh.trade about whether there is a contingency plan for investors if they were ever to cease operations.
Mesh.trade managing director Connie Bloem explained that several measures are in place to ensure clients still have access to their underlying assets.
“Our philosophy has always been that if something happens to Mesh, or if we’re no longer serving your purpose, you should be able to take your assets and go,” Bloem stated.
“One of my pet peeves is that if you want to take your assets and go, most platforms force you to liquidate your portfolio and take that tax hit before reinvesting elsewhere. That’s not why we invest.”
Bloem explained that at Mesh, every client has their own blockchain account. This means the assets held are truly theirs and not in a pooled account managed solely by Mesh.trade.
Clients can transfer their assets and take custody of their accounts by managing their own private keys, allowing them to leave the platform if they choose.
Additionally, even if Mesh.trade were to go under, Troy Gold would continue to service customers with TGLD tokens.
Bloem explained that if a client could prove ownership of the token, they could approach Troygold directly to redeem it for physical gold.
Therefore, even if Mesh.trade were to stop operating, clients would still have direct ownership of their tokenised gold assets on the blockchain and a mechanism to redeem them through Troygold.
Source: Mybroadband
