Digital Gold Currency Case Study: GoldMoney

GoldMoney® payments combine the world's oldest money, gold, with the world's newest Internet and mobile phone technology.

From anywhere in the world an Internet connection enables GoldMoney® customers to buy & sell or store gold, silver & platinum. A further advantage of the patented GoldMoney® system is the ability to send and receive payments denominated in gold between other GoldMoney® accounts. While the book entry ownership of the metal changes during a payment, all of the vaulted precious metal stays fully insured and securely stored in London, Zurich and Hong Kong.

At the time of this company's launch in 2001, GoldMoney's stated objective was to offer a payment system of unequaled integrity. In less than a decade GoldMoney® has achieved this stated goal on a global scale.

Companies such as Webmoney Transfer and GoldMoney® actually listen to the feedback from their customers and work to offer catered retail solutions. James Turk, founder and director of GoldMoney® said: "Most of the changes to the site were a direct result of customer inquiries and suggestions. We believe this redesign that we launched today successfully meets their requests."

GoldMoney is not a paper promise of gold. The precious metal in a GoldMoney allocated holdings account is identified as the customer's direct ownership of the metal.

Because GoldMoney is a digital gold currency, this type of Internet account offers 24/7 access which provides valuable liquidity for all users.

Today GoldMoney has about 15,000 customer holdings accounts and a client base that is spread throughout more than a 100 countries. The total value of all metal and cash held for customers now exceeds $1,400,000,000 (One billion four hundred million U.S. Dollars)

Anyone can set up an account at Goldmoney.com in as little as 10 minutes. GoldMoney's patented digital gold currency is called "goldgrams" and 1 goldgram ® = 1 gram of pure gold. The smallest payment possible in a GoldMoney account is one mil (0.001gg). GoldMoney is one of the original digital gold currency companies and this company was pioneered by Mr. James Turk. Precious metal can be purchased online from the safety of your own home and sending or receiving goldgram® payments from one account to another is permitted. GoldMoney offers competitive pricing, transparent rates and physical delivery of 100gram or kilo sized bars of pure gold.

GoldMoney's headquarters along with their database servers are located in Jersey, British Channel Islands, a British crown dependency in the English Channel near the north-western tip of France.

Important points:

-All accounts offer customers the ability to pay and receive digital metal from another GoldMoney customer
-While third party agents are permitted, Kitco is currently the only agent and a majority of customer funds flow from the customers' bank directly to GoldMoney
-Extensive KYC and AML policies have always been in operation requiring prior identification and identity screening before using a GoldMoney account

The Customer Acceptance Program (CAP) requires all customers to provide identification and source of funds just like a bank account

GoldMoney has received four US patents for inventing digital gold currency. The awarding of these patents acknowledges that GoldMoney is advancing the 'prior art' of global online payments. Namely, we have created a more advanced, and therefore better currency than the currency that now exists. The patents illustrate why GoldMoney is a currency that is ideally suited for electronic commerce.

The first patent application was filed in February 1993, and US Patent No. 5,671,364 was awarded in September 1997. This patent provides for a system and method that enables gold or other commodities (tangible assets) to circulate through an electronic medium as currency in a book entry accounting system.

The second patent, US Patent No. 5,983,207, was awarded in November 1999. This patent provides for a system and method that enables gold or other commodities to circulate electronically as digital cash, ensuring privacy and facilitating micro-payments.

The third patent, US Patent No. 6,415,271, was awarded in July 2002. This patent provides for a system and method that enables gold or other commodities to circulate electronically as digital cash over wireless networks and by means of electronic devices such as smart cards.

The fourth patent, US Patent No. 7,143,062, was awarded in November 2006. This patent provides for a system and method that enables gold to circulate as digital cash through a global computer network such as the Internet and/or private communication networks, much like cash currently circulates in the physical world.

Similar to Webmoney's innovative business style, GoldMoney has become the leading digital gold currency in the world by introducing new technology along with convenient & innovative products, listening to customers, seeking partnerships with existing related businesses and seeking out new consumer markets.

For the last decade, Mr. James Turk of GoldMoney has paved the road for digital gold currency products and issuers. GoldMoney is the global leader and has built a digital gold global marketplace from the ground up. Mr. Turk's actions now make it possible for others to follow with complementary and competing digital gold products. Over the last decade here are some of the events and innovative products which have led the growth of GoldMoney.

-2002 - Partnered with Kitco precious metals dealer
-2004 Enabled 'electronic check' payments for Canadian customers-Website linked with Canadian banking system, buying or selling- funds are seamlessly moved to & from customers' Canadian bank accounts
-January 2006 - Introduced digital silver bullion accounts
-May 2007 - Introduced multi-currency Customer Segregated Funds Accounts - Interest bearing pooled funds account in Jersey for parking of customer funds between transactions
-October 2007 - Partnered with Berkeley Burke & Co Ltd, to offer UK customers a Self Invested Personal Pension ("SIPP") which is designed especially for holding gold.
-March 2008 - GoldMoney partnered with Entrust Group. US customers can now hold digital gold & silver GoldMoney units in IRAs (individual retirement accounts)
-April 2008 - Expanded Customer Segregated Funds Accounts to include foreign exchange service between currencies. Customer options include US dollar, British pound, euro and Canadian dollar
-December 2008 - Implemented online identity verification service through Equifax. Enables US & UK residents to open an account entirely online and transfer funds within 20 minutes.
-July 2009 - Introduced digital platinum bullion accounts
-October 2009 - Appointed Inspectorate International Limited to perform independent audits of gold, silver and platinum held on behalf of GoldMoney customers. Certificates available online.
-November 2009 - Launched a German language version of the website and relationship management team.
-December 2009 - Simplified the online account opening process. Now available for residents in 28 countries, sign up is fast and entirely online. Includes USA, UK, Canada, Germany and Australia.
-December 2009 - Published a video tour of VIA MAT INTERNATIONAL AG, Switzerland's state-of-the-art high security precious metals vault. Permits customers from anywhere to take a virtual walk through the vaults.
-April 2009 - Launched Registered 400oz Gold Bar facility, which enables GoldMoney customers to record direct ownership of one or more large gold bars.
-March 2009 - Launched the world's first iPhone application designed specifically for mobile bullion exchange transactions.
-June 2009 - Partnered with Baird & Co. Customers can redeem and take physical delivery of their gold in convenient units of 100 gram or one kilo (1,000 gram) gold bars. UK pick up or delivery available to 16 countries.
-April 2010 - Expanded global storage facilities. Gold, silver and platinum can now be stored in VIA MAT's secure and insured Hong Kong vaults.
-September 2010 - Now offering residents of Canada online identity verification through Equifax Canada (Open an account entirely online, buy metal and transfer funds within 20 minutes)
-November 2010 - Developed the "GoldMoney Standard". Using ultrasound technology, each bar in storage is now scanned for foreign material and defects

GoldMoney Ownership & Partners
-September 2002 formed a GoldMoney-Kitco alliance for sale of precious metal online.
-February 2003 Completed additional financing for future expansion with IAMGOLD Corporation, a major Canadian gold mining company that is publicly traded on the Toronto and American stock exchanges.
-January 2004 South African company Durban Roodepoort Deep, Limited [DRD] bought stake in GoldMoney.com, April increased that stake to a total of $2 million USD or 14% of the company.
-July 2006 Sprott Asset Management Inc. increased their ownership stake to 9.9% -Sprott has been a shareholder since 2003
-Precious metal insured through a policy underwritten at Lloyd's of London.

In March of 2009, GoldMoney introduced a new iPhone application which allows customers to check balances, make payments, view transaction history and exchange units of digital gold and silver using an iPhone. The GoldMoney application for the iPhone provides an easy to use trading system that you can hold in the palm of your hand.

All payments completed in a GoldMoney account are non-repudiable meaning the funds are irrevocable and irreversible. GoldMoney is the Registered Business Name of Net Transactions Limited which is regulated by the Jersey Financial Services Commission.

As the digital gold currency industry leader, GoldMoney sets the standards for governance and customer protections. Digital GoldGrams are added to a holdings account only after grams of gold have been deposited to the vault. GoldMoney will never extend credit nor engage in fractional reserve banking. All forms of physical bullion in a Vault must meet the London Good Delivery Standard established by the London Bullion Market Association, http://www.lbma.org.uk

Governance is the procedure by which these DGC companies ensure that the value of precious metals held in the vault is always equal or great than the total value of outstanding digital units

GoldMoney works closely with its third party service providers to complete all essential functions under carefully designed checks and balances that ensure customer protections and the safety of each customer's gold.

GoldMoney represents:

-The quantity of goldgrams is always equal to the quantity of grams of gold in the vault. GoldMoney guarantees it.
-GoldGrams are added to a Holding only after grams of gold are entered into the vault.
-Gold will only be delivered from the vault to a user if the exact corresponding quantity of goldgrams is first removed from the user's Holding.
-GoldMoney will never extend credit nor engage in fractional reserve banking.
-The gold in the vault always meets the Chain of Integrity standard established by GoldMoney.