SEBA Bank launches regulated gold token to enable digital ownership of physical gold

On Dec. 15, SEBA Bank, a Swiss-licensed digital asset banking platform, launched a regulated digital token backed by physical gold. Due to its regulatory-compliant nature and the low volatility of gold prices, the gold token could eventually be used as a stablecoin for on-chain transactions, SEBA said.

In other words, the gold token is designed to have a similarity to the gold standard, with fiat currency being backed by its exchangeability with physical gold, in addition to being trusted by the issuing government. In 1971, U.S. President Richard Nixon removed the U.S. dollar from the gold standard, and under the 1944 Bretton Woods system, $35 was exchanged for one ounce of gold.

Gold-backed currencies are known for their ability to stave off hyperinflation — a common concern among cryptocurrency enthusiasts. However, they also have the disadvantage of prolonging economic depressions, as the ability of governments to deliver stimulus is limited by the supply of gold. No country in the world is currently on a gold standard or a silver standard.

Buehler explained the development in the following statement:

“Redemptable at any time, on-demand, directly from the refinery; our gold tokens remove the friction for investors from holding gold and provide a cost-effective solution for owning assets fit for purpose in the new economy.”

Previously, SEBA launched a project for users to earn income from cryptocurrencies. SEBA is the first bank in Switzerland to obtain a digital asset custody license.

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