Dubai to Trade Tokenized Gold
Dubai Multi Commodities Centre (DMCC) announced a partnership with Comtech Gold to trade tokenized gold. The digitized precious metal, backed by physical gold bullion, will be certified by the government.
The government of Dubai plans to begin trading tokenized gold. As part of the initiative, DMCC announced a partnership with Comtech Gold.
Tokenized assets will be backed by gold bullion registered on DMCC Tradeflow, the UAE government’s online platform that records ownership of commodities. Therefore, each tokenized gold bullion will be secured by a state certificate, increasing the security and transparency of precious metal trading.
Bullion tokenization will be done using the Xinfin Protocol (XDC) blockchain network. Each Comtech Gold Token (CGO) will represent one gram of .999 fine gold, fully backed by a physical asset. Tokenized in this way, physical bars will “feature unique ID numbers and certificates.”
Dubai Multi Commodities Centre (DMCC) is a government organization established to expand the flow of commodity trade through Dubai. DMCC is the UAE’s free economic zone and global trade center.
Ahmed Bin Sulayem, CEO at DMCC, believes the initiative will provide an opportunity to make the gold trading market more accessible. Blockchain will allow trading in smaller fractions of a single gold bar, potentially bringing new investors to the market. Tokenization and digital assets will simplify the gold trading process for potential investors by eliminating the need to transport and store purchased bullion.
An international system of monitoring the gold bar integrity, chain of custody, and provenance is already being developed on the basis of blockchain technologies. It’s aimed at promoting the development of the industry by making it more transparent within the existing laws.