Tokenized Physical Assets Chapter 1: Making gold available to the world

Transcription

1 Tokenized Physical Assets Chapter 1: Making gold available to the world whitepaper

2 Gold is a constant. It s like the North Star. Steve Forbes, founder of Forbes.

3 CONTENTS Tokenized Physical Assets 1 Chapter 1: 1 Making gold available to the world 1 1. Executive summary 5 As such, one AurusGOLD (AWG) is: 6 2. About Gold and Money 7 Today s gold market and the missed opportunity 8 We believe it s time for change Aurus: Gold as Cryptocurrency Aurus Tokens AurusGOLD (AWG) AurusGOLD Coin cycle Trading and fees Withdrawal (Burning AWG tokens) The AurusGold token audit AurusGOLD (AWG) Blockchain transaction fees The AurusGold token specifications AurusCOIN (AWR) Token AWR Coin Cycle: Issuance AWR Coin Trading Collecting and Distributing fees AurusCOIN (AWR) tokens specifications The Platforms 27 Web back-end application 27 Web and Mobile front end Applications 27 APIs/Plugins 28 Blockchain explorer Use cases of AurusGold (AWG) 30 3

4 AurusGOLD (AWG) payments 30 Gold debit card 30 Crypto trader safe haven 30 ICO volatility protection 31 Gold asset management 31 AurusGOLD (AWG) as collateral 31 AurusGOLD (AWG) lending 31 AurusGOLD (AWG) as heritage 32 Mining Gold with Ether Benefits % Liquidity 33 Accessibility & Ease-of-use 33 Decentralised sources 34 Stable value economy 34 Trust Future Plans 36 Aurus Gold Consortium 36 Tracing Gold Provenance 36 A Gold Fund for Golden Ideas 36 Tokenisation of Underground Gold 36 Golden Charity 37 Step 2 and onwards 37 4

5 1. Executive summary Our goal is to enable people to use gold, the most stable and well known asset in history, as a highly liquid, global, day-to-day currency. Aurus aims to be a bridge between the traditional gold market and the new, crypto economy by using blockchain technology to create a simple yet effective gold backed cryptocurrency accessible to individuals and organizations all over the world to own, trade and use. We achieve this by providing tokenisation-as-a-service on the Ethereum public blockchain to qualified commodity providers who account for an estimated 30% of the bullion gold market. The AurusGOLD (AWG) token is the first Aurus precious metal currency, backed by fully allocated 99,99% LBMA approved gold. All gold is located in partnered, fully-audited and insured vaults. AWG creates a decentralised gold market by enabling established gold traders and providers to tokenise the same metal under one currency, thus generating a highly liquid and stable market. By allowing multiple highly reputable gold traders and providers to use a single protocol to tokenise the precious metal under the same cryptocurrency, AWG will create a large, independent, decentralised and easily-scalable gold market not beholden to any central government organisation. 5

6 Aurus business model and coin mechanisms are designed for simplicity, trustworthiness and eaase of use. Our team makes efforts on all fronts (legal, compliance, design, technology) to ensure that we provide ease-of-doingbusiness to our Partners (Vaults, Providers and Distributors) and a currency that its holders trust, is accessible and holds its value. AS SUCH, ONE AURUSGOLD (AWG) IS: 1 gram of 99.99% LBMA Gold Part of a gold bullion sitting securely in a specialised, fully insured and audited vault. Created by an established gold trader located in Western Europe, Australia or the U.S that has been verified by the Aurus Gold Consortium. Backed by fully allocated gold bullions, traceable through a smart contract. Redeemable at any time through the Asset Reconstruction Smart Contract. 100% liquid to FIAT or to physical bullion gold. 6

7 2. About Gold and Money Gold has fascinated humanity since the beginning of time. Recognised as a trusted means of storing and trading wealth since 3,000 BC 1, few metals have had such an influential role as gold in human history. It became the most popular form of payment anywhere around the globe, making it one of the first standards of preserving and transferring value. Simply put, gold was the first globally accepted currency. As societies evolved, with the complexities of global, interconnected economies, we moved towards today s FIAT currencies. Modern currencies are no longer backed by gold, but created and maintained through complex financial mechanisms and by leveraging debt. Through all this, gold has remained stable and provided consistent value to those who hold it. It s been said that an ounce of gold could buy 350 loaves of bread in Biblical times. Today, an ounce of gold still buys about 350 loaves of bread 2. However you slice it, whether the system falls into a deflationary depression like the 1930 s or an inflationary recession like the 1970 s, gold will maintain its purchasing power. 1 Hur, J. (2017, November 17). The History of Gold. Retrieved November 30, 2017, from 2 Mariottini, C. (2013, November 27). Gold and Bread. Retrieved November 30, 2017, from com/2008/06/10/gold-and-bread/ 7

8 Though past performance is not necessarily an indicator of future results, we have over 6,000 years of history backing gold s legitimacy as a true mechanism of exchange. 3 TODAY S GOLD MARKET AND THE MISSED OPPORTUNITY Being mined for ages, spread across the world and with multiple uses (jewellery, technology, investment), it is difficult to know the exact size of the gold market. The following estimation is considered realistic: Gold demand Total supply of above ground gold = (approx.) $6.3 trillion Aurus is concerned with gold as investment due to its relevance and performance in storing and trading value in the traditional markets, and aims to bring this opportunity to the crypto-markets. For centuries, investors and savers have depended on gold in times of economic and 3 Slavo, M. (2013, January 06). Gold s Two Stories: Paper Markets Collapse... While The Retail Public Buys At A Record Pace. Retrieved November 30, 2017, from 8

9 political strife, and its investment case right now is as compelling as it s ever been. 4 Gold trades more than many other financial assets, with daily trading volumes between $67 - $150 billion Based on a estimated 1-year average trading volume as of July,2017 Source: Gold Investor September 2017 World Gold Council, September v2017 Gold returns are competitive compared to major financial assets. Performance metrics for major global financial assets in US$ based on data ending 31 August 2017 Source: Gold Investor September 2017 World Gold Council, September 2017 As lucrative as the gold market is, buying gold is more complicated than many people think. Bullion trading is restricted to less than 3% of the population. To simplify this process, gold has begun trading digitally, either fully allocated or not, under the form of gold receipts, derivatives, gold funds, and mining stocks. 4 Holmes, F. (n.d.). Global Debt Levels Gold Risk Protection World Gold Council. Retrieved November 30, 2017, from 9

10 The most common practice to purchase gold is through paper gold receipts issued by gold traders. The receipts are certificates of ownership of a certain amount of gold stored in a vault, at a certain storage cost paid monthly or upon withdrawal by the owner. This is the way the system has been since the 16th century and the only change ever since is that nowadays the certificates can be digital. While buying trading positions into gold may be simpler than acquiring bullion, it s riskier, since there is rarely proof of any underlying gold. Owning gold is at best very expensive or, at worst, extremely complicated. And peer-to-peer trading is nearly impossible without blockchain technology which creates a medium for a trustless exchange of gold. Source: Gold Investor September 2017 World Gold Council, September v

11 WE BELIEVE IT S TIME FOR CHANGE. We believe that gold has still a lot to offer and the market has a lot of untapped potential. Blockchain can bring the speed and convenience of the purely digital cryptocurrency world, and by combining that with a fully-allocated gold currency, we can give traders the speed they need, with the full transparency and proof of ownership currently lacking. Cryptocurrencies hold great promise to decentralise financial markets and bring transparency for individuals. Yet, however strong the algorytms behind them are, at the moment their value is highly volatile. Thus Aurus sets to bring the best of both worlds by bringing real gold in the virtual cryptocurrenty ecosystem, in a way that is open, trustworthy, reliable and accessible. 11

12 3. Aurus: Gold as Cryptocurrency Aurus proposes a major shift in the way gold is owned and traded. The Aurus protocol of asset tokenisation is used to create tokens that act as certificates of ownership of gold stored in fully-audited, partnered vaults and that are very easy to trade (including peer-to-peer). By making a decentralised gold backed AWG coin we can to democratize gold and provide both high liquidity and low transaction costs along with the unfettered ability to convert the AWG token to physical gold at anytime. AurusGOLD (AWG) is a cryptocurrency that is 100% backed by gold. Each AurusGOLD (AWG) token represents 1 gram of gold located in a fully-audited, partnered vault. As tokens are traded, transaction fees are generated, a part of which are allocated to the vault partners to cover the costs of storage (inclusive of insurance), making Aurus a completely sustainable and scalable system. Creating AurusGOLD requires proof of ownership of the gold located in a partnered vault and a recurring audit on the gold itself. Beside this, the currency is completely decentralised. Gold traders can tokenise their gold and sell the currency on their own platforms, on our platform or on crypto exchanges. End buyers can trade them over the counter or to accepting merchants or other gold traders. 12

13 4. Aurus Tokens In Step 1: Making gold available to the world Aurus introduces two tokens: AurusGOLD (AWG), a cryptocurrency that is 100% backed by gold; and Aurus (AWR) which distributes transaction fees of all Aurus Asset tokens (starting with AWG) AURUSGOLD (AWG) AurusGOLD (AWG) is an ERC223 token backed by 1 gram of allocated, 99,99% LBMA-approved gold. It is created by experienced gold traders / providers using the Aurus asset-tokenisation protocol. From a market standpoint, AWG is fractionated physical gold, meaning it will maintain a stable value close to that of bullion gold ($41.8 / gram at time of writing) AURUSGOLD COIN CYCLE As AWG are 100% gold-backed tokens on the Ethereum blockchain, issuing new tokens into the market requires gold bars to be stored in a partner vault and audited. The token has 18 decimal points and features all the functionalities of the ERC223 standard. 13

14 The contract Application Binary Interface (ABI) is available on the Etherscan page and we undertook a code audit on the smart contract to identify any security or integration issues. As an ERC223 token (100% cross-compatible with ERC20), it can be easily integrated inside exchanges and third party wallets. Our team has developed a tutorial for using AurusGOLD (AWG) with MyEtherWallet and Mist Ethereum wallets. Please note that to make transactions with third party wallets, you need to have enough ETH to pay for the network transaction fees. The coin cycle features four participants that take part in the issuing and burning of the token: THE VAULT, THE GOLD PROVIDER, THE AUDITOR, THE AURUS AUDITOR. THE VAULT is responsible for safeguarding the physical gold bars, as well as managing the insurance. 30% of the fees generated by the system (in AurusGOLD) are distributed to the vaults, proportional to the amount of gold they are storing. Vaults will receive fees monthly based on the following formula: T S V R F T V S - Total amount of fees generated in the past week - The amount of gold stored (grams) by the vault - Total available supply of AurusGold (grams of gold in the system) - Total revenue distributed to the vault (in AurusGold tokens) The fees are automatically distributed to the Ethereum addresses that identify the VAULT Partners. These are the same addresses used by the VAULT Partners to sign various transactions on the Blockchain. 14

15 The second party that manages the system is the AurusGOLD (AWG) PROVIDER Partner. In general, this will be a gold trader who is the initial owner of the gold and is the entity that initialises the tokenisation of the physical gold into AWG tokens. The only gold capable of backing AurusGold (AWG) tokens is London Bullion Market (LBMA) approved bullion. Providence and proof of ownership must be established and published before tokens are generated. The proof of ownership of the gold bar is submitted and timestamped on the Inter Planetary File System (IPFS) Blockchain. The proof-of-ownership documents are: Invoice and payment proof Delivery note The proof-of-ownership will be public and can be audited by any partner in the system, as well as any AWG token holder. An AurusGOLD (AWG) PROVIDER Partner can initiate a tokenisation request by calling the initiatetokenissuerequest function. This method can only be called by approved gold traders. This action, of itself, does not issue any tokens. To create a Token Issue Request (TIR) the PROVIDER enters the following information: Identifier for each bar of gold (individual unit): Weight of the bar in grams Manufacturer of gold bar 15

16 Purity of gold bar Serial number Identifier for the storage compartment of the VAULT Partner Proof-of-Ownership (documents uploaded on IPFS, linked to Ethereum Blockchain transaction) The public address of the wallet that will receive the AurusGold (AWG) tokens. The TIR is visible on the Blockchain to all parties involved. Once it s created, a TIR must be closed (completed) in a maximum of 1 week. A TIR is completed by the VAULT Partner that can sign a transaction called verifystoragetokenissuerequest with the details about the verification of the asset. The AurusGOLD (AWG) AUDITOR is part of the Vault internal audit system. The main scope of the internal auditor is to guarantee that the AurusGold (AWR) marked as stored in the Vault are actually present. The internal Auditor falls under the responsibility of the VAULT Partner and contributes by preventing any miss-match in the final Aurus Auditor report. Both auditors (The Auditor and The Aurus Auditor) have the role of verifying the proof of ownerships uploaded by the Gold Provider. Should anything be inconsistent, the Auditor signs a transaction which contractually obliges that the gold bars in question are replaced by the respective AurusGOLD PROVIDER in less than 48 hours with gold bars with provenance that can be satisfactorily verified. 16

17 The Aurus Auditor is a company-wide, cross-vault audit entity that verifies that the total amount of tokens in circulation is 100% backed by assets stored within partnered VAULTS. Its role is not mandatory at the moment of the TIR, but it is mandatory to be made every 6 months for each token issued into the market. This report needs to match the internal report of each Vault and its Auditor (that is issued at the moment of the TIR) and cross-vault reports (for internal transactions between Vaults, withdrawals from different Vaults, etc, which are kept in check by the relevant Vault AUDITORS). Since AurusGOLD (AWG) is based on LBMA approved standardised gold, it is possible for a quantity of gold purchased from one Vault to be withdrawn from another Vault. The scope of this is to offer customers the possibility of withdrawing gold from any Partenered VAULT (as per the Asset Reconstruction Mechanism described in section ). The settlement of the assets between vaults is managed through AurusGOLD (AWG) token swaps as well as assets transfers that will be audited. The balance of each Vault is verified during the Aurus Auditor cross-vault verifications TRADING AND FEES The traditional gold market charges storage fees (monthly or yearly), but the cryptogold economy cannot accommodate these kind of fees. Principally, building a decaying token (a token that loses its balance over time) does not work as exchanges cannot process it without custom development. Also, working in a decentralised economy means that we cannot know who is the 17

18 real owner of a token. In many cases, tokens are stored in centralised wallets (web-wallets, exchange wallets etc), that manage other customer funds as well. Charging a fee to hold tokens would not be permitted as it breaks the business model of many real-life systems. AurusGOLD (AWG) uses a dynamic internal fee system for sending tokens from one wallet to another. Aurus transaction fees are designed to fairly cover storage and insurance costs of the physical asset each token holder owns. In order to achieve this, our smart contracts will keep a ledger of coins held within each address and create a custom transaction fee in order to make the system equitable. The transaction fee has two components (a base fee and a dynamic feee) which are detailed below. The base transaction fee will be 0.05AWG or 0.15% of the transaction (whichever is greater). The dynamic transaction fee is being calculated using a daily time factor of %, giving AurusGOLD (AWG) a dynamic fee of 2% per year for each coin in circulation, which includes the cost of the storage of the physical gold backing the token and its regular independent (external) auditing. For example, for a wallet that received 1,000 AWG over a period of time, the dynamic fee will function as follows: Amount of gold (AWG or grams) Time passed (days) Transaction fee(%)

19 In this example, the wallet received 200 AWG (or grams) 365 days ago. For that amount, the token holder needs to pay a fee of 1.99%. The wallet also received 400 AWG 150 days ago, the transaction fee for which is now 0.82%, etc. In order to make the transaction fee of the following transfer fair, we calculated it as a weighted average of the aforementioned feed, weighted against the amounts, with the following formula: In this example, the dynamic transaction fee applied for sending AurusGOLD (AWG) to any other wallet will be %. To keep the transaction fees fair, when an outgoing transaction occurs, the ledger will proportionally subtract the outgoing amount from the ledger, gradually depleting the old amounts as the transaction fees cover the costs of storage for that particular amount. The fee is paid by the sender of a transaction. The transfer function of the smart contract automatically calculates the appropriate fees and adjusts the sender balance. For third party integration with wallets and exchanges, the smart contract enables developers to calculate the fee of sending AurusGold (AWG) without actually pushing forward the transaction. This function will be mainly used by shared, centralised wallets that hold tokens for multiple users and cannot accommodate an individual fee property. AWG also has a withdrawal fee that is charged when an AWG holder wants 19

20 to withdraw physical gold out of an AWG VAULT Partner. The fee ranges from 0.2% for large amounts of coins to 3% for small amounts, as per the following table. Amount of AWG (grams) to be withdrawn Withdrawal fee(%) 0-1,000 3% 1,000-10,000 1% , % More than 100, % The withdrawal of the gold is subject to KYC and AML procedures carried out by the Vault before withdrawal. AurusGOLD Partners are free to provide additional services (such as delivery) for extra cost, subject to direct payments to the Vault. Withdrawal fees can be paid in AWG or the FIAT currency that the specific Vault accepts. 20

21 WITHDRAWAL (BURNING AWG TOKENS) To maintain the complete traceability of gold and provide a fully allocated bullion solution, the owner of the tokens can only withdraw the bullions they own through the tokens. Because of the dissemination of the tokens to all the token owners, the AurusGold smart contract features an Asset Reconstruction Mechanism that enables owners to exchange their tokens for all the tokens that represent an entire physical asset. This means that each token has encoded the unique identifier of the gold bar in its definition. Holding multiple AurusGold (AWG) tokens in your wallet can sometimes mean that you own small parts of different gold bars. The AurusGold (AWG) system is fully auditable and each token (individual uniquely identified token) is represented by the asset in one of the partner Vaults. The Token Exchange interface is automatic and all users agree automatically on the result. The interface can only be called once every Ethereum blocks (~5 hours) for the recovery of individual bullions. 21

22 THE AURUSGOLD TOKEN AUDIT The AurusGOLD (AWG) token audit features enable a certain token to be linked to a real gold bullion bar. Each token stores the bullion identifier and properties. The process of minting a new AurusGold token involves saving the preblockchain traceability of the gold and proof-of-ownership AURUSGOLD (AWG) BLOCKCHAIN TRANSACTION FEES AWG uses a smart-contract structure to manage the payment of the ETH gas for all transactions completed on the Blockchain. As the aim of the AWG is to allow the trading of gold (and other commodities) 22

23 by anyone, we don t expect that our customers also hold ETH in order to send AWG. The exchange smart-contract manages the transfer and enables the user to pay the fees directly in AWG, by instantly exchanging AWG to ETH at the moment of the transaction. Because of the huge volume provided by the bridge to the gold market, as well as the stability of the gold price, the exchange smart-contract wouldn t have any issues operating under large transaction payloads. Any user can choose to participate in the token transaction exchange smart contract by sending ETH to the contract. The ETH will be used by AWG users to pay the transaction fees, in exchange for AWG tokens. The ETH supplier will receive AWG tokens directly in his wallet address THE AURUSGOLD TOKEN SPECIFICATIONS AurusGold is an ERC223 Ethereum token issued on the public Ethereum blockchain. The token has the identifier AurusGOLD and a short name of AWG. The token has 5 digits after the decimal point. The total and available supply are dynamic, based on the amount of gold stored in the vaults. The token is open-source and auditable on the Ethereum explorer etherscan.io (total supply, available supply, wallet balances and source code). 23

24 4.2. AURUSCOIN (AWR) TOKEN The AurusCOIN (AWR) is an ERC223 Ethereum-based token that enables contributors to invest in the Aurus platform and provides a means of return on investment. It is issued via an ICO and has a maximum supply of 30,000,000 units. Through the AurusGold (AWG) trading and transfer mechanism, 50% of all transaction fees (which are to be paid in AWG) are directed into the AurusCOIN (AWR) Ethereum smart-contract which is responsible for the temporary storage in a reserve and subsequent redirection of AurusGOLD (AWG) to AurusCOIN (AWR) token holders. The reserve can be composed of tokens issued by different VAULT Partners as transactions can occur with tokens that represent different assets from the same class (for example parts of different gold bullions that are stored in different Vaults). As transactions of AurusGOLD (AWG) occur, AWG transaction fees are redirected into the AurusCOIN smart contract which increases the reserve of AWG until an amount of 0.5 AWG (the equivalent of 0.5 grams of gold). When the reserve reaches this amount, the 0.5 AWG are transferred into the a wallet of the AurusCOIN token holder s choice (set as the same wallet as the AurusCOIN by default). 24

25 4.2.1 AWR COIN CYCLE: ISSUANCE All AurusCOIN tokens are pre-mined, with a limited supply of 30,000,000 with the purpose to be used by the Aurus platform as a funding mechanism, through an ICO (Initial Coin Offering) AWR COIN TRADING The AurusCOIN token is an ERC223 token which requires only the base ETH transaction fee to be paid upon transfer. By using the transaction fee system created for AurusGOLD (AWG), AurusCOIN (AWR) transaction fees can also be paid in AurusGOLD (AWG), eliminating the need to own ETH at the moment of the transaction. This only applies to wallets that utilise the Aurus Blockchain fee mechanisms COLLECTING AND DISTRIBUTING FEES As each AWG transaction from one wallet to another generates fees, all the fees are stored in a smart contract that manages the distribution of those fees to either partner Vaults or the AurusCOIN holders. Fees are not distributed instantly to the AurusCOIN holders because of the costs and limitations of the Ethereum platform. As the fees are collected, a user can choose to withdraw his share of the fee back to his AurusCOIN token holder address or they will be transferred automatically once the reserve reaches 0.5 AWG or at the point that any AurusCOINs are transferred from one wallet to another (in order to empty the reserve before transferring the ownership of the token). 25

26 4.2.4 AURUSCOIN (AWR) TOKENS SPECIFICATIONS Ethereum-based ERC223 token deployed on the public Ethereum Blockchain Total supply of units 5 decimal points 26

27 5. The Platforms WEB BACK-END APPLICATION Aurus BV has developed a platform that enables Gold Providers, The Vaults and the Auditors to cooperate in tokenising gold. Our web application acts as a wallet for all the partners in this system and enables blockchain transactions to be signed. Since Aurus is built on the Ethereum blockchain, all the mechanisms and functionalities provided by the web application can also be used directly via a smart contract. This enables an ecosystem beyond any centralised application and/or entity maintaining it, contributing to our vision of a new decentralised economy. WEB AND MOBILE FRONT END APPLICATIONS We re building a user-friendly mobile & web wallet for storing and trading the Aurus tokens. The Aurus wallets will guide users through creating a cryptocurrency wallet, explain how public and private keys work, provide the option of creating a simple (web) wallet or a custom (secured) wallet and allow users to store AurusGOLD tokens, see their worth, undertake transactions, view trading history, etc. By offering an interface that is more user-friendly and accessible than many competing wallets, we aim to reach beyond the specialised worlds of those familiar with crypto-currencies and professional gold traders. 27

28 Future functionalities include the ability to integrate debit cards, allowing people to pay in mainstream stores through instant FIAT currency conversion and to order physical gold to their location should they so desire. APIS/PLUGINS The web application provides a REST API for direct selling of AurusGOLD (AWR) tokens. We have also built a plugin for Gold traders to buy and sell AurusGOLD from their own websites, enabling them to easier service their existing clients and to extend their reach to new ones, and increase the overall liquidity of the token. BLOCKCHAIN EXPLORER To provide full transparency, we have decided to use an external blockchain explorer for analysing the standard token attributes that AurusGOLD supports. Using the Ethereum blockchain explorer, etherscan.io, the investors, customers and gold traders can view the following data: The total supply of AurusGOLD tokens. The balance of any wallet. All transactions made with AurusGOLD. The provenance of each token. 28

29 Because etherscan.io only provides interfaces for standard ERC20 Ethereum tokens, our company has developed a blockchain explorer to expand these functionalities to include data about: Pending gold token issuance requests. AurusGOLD Partner signing attributes. 29

30 6. Use cases of AurusGold (AWG) AURUSGOLD (AWG) PAYMENTS AurusGOLD (AWG) can be used for payments in multiple ways, giving users a long term stable store of value that can be also instantly spent. Our wallet will be integrated with a debit card solution that will provide an automated exchange to FIAT at low rates from AurusGOLD Partners. We will be integrating AurusGOLD (AWG) in as many payment gateways as possible, allowing AWG holders to spend AWG directly with merchants. GOLD DEBIT CARD By making gold more liquid, we are helping people use a stable asset in their daily life. This will be done through the issuing of gold debit cards and the integration of the AWG currency within different payment providers. CRYPTO TRADER SAFE HAVEN The cryptocurrency market has proven to be highly volatile. Introducing AWG, a fully-allocated gold currency, could prove useful to hedge against potential losses and provide sanctuary from volatility whilst maintaining liquidity. 30

31 ICO VOLATILITY PROTECTION Many believe the ICO is the venture financing mechanism of the future. Lots of promising startups promise long term visions to the market and raise large amounts to deliver upon them. Crypto volatility can negatively impact this process, with companies potentially losing substantial value before it can be utilised. Gold benefits from long term stable values, hence ICO funds can be raised or converted in AWG to hedge against falls. GOLD ASSET MANAGEMENT Currently, vaults, gold traders and gold providers are obliged to physically transport large amounts of gold periodically to balance out individual centralised ledgers and inventories of gold. With AurusGOLD, the physical transport becomes redundant since blockchain gives the opportunity to move the value of gold without the physical object moving. AURUSGOLD (AWG) AS COLLATERAL By creating multi-signature escrow wallets, AWG is a stable value currency (as is backed by real gold) that can very easily be used as collateral for a loan. A multisignature escrow wallet allows loans, escrow funds and settlement of payments from wallet to wallet governed by intelligent smart contract, depending on certain criteria. AURUSGOLD (AWG) LENDING AurusGOLD (AWG) intends to partner with peer to peer crypto lending solutions to offer loans against our strong and stable cryptocurrency. 31

32 AURUSGOLD (AWG) AS HERITAGE A similar multi-signature wallet mechanism allows AWG holders to transfer their AurusGOLD (AWG) to their heirs through lawyers that act as trustees or under power of attorney controlling the escrow. Intelligent smart contracts help to prevent fraud by keeping the funds frozen after the transfer and giving the initial wallet owner the capability to reverse the process for a certain period of time. MINING GOLD WITH ETHER Aurus tokens are ERC223 tokens, meaning they require ETH to transact. In order to simplify the process of trading AurusGOLD (AWG), we are developing a wallet of our own and a protocol that allows independent third party ETH holders to contribute ETH to an AWG transaction in exchange for AurusGOLD (AWG). This means that AWG holders can transfer AWG without owning ETH and ETH holders can automatically convert ETH to AWG by paying the ETH fee on behalf of the initial AWG holder. 32

33 7. Benefits 100% LIQUIDITY AurusGOLD PROVIDER Partners are reputable gold traders of great integrity and experience verified by the Aurus Gold Consortium. Given the depth of the bullion gold market, gold traders have agreed to automatically buy back AurusGOLD (AWG) for FIAT currency, giving AWG 100% liquidity to FIAT as well as to physical bullion gold. ACCESSIBILITY & EASE-OF-USE Aurus, through AurusGOLD, broadens the audience of gold trading by making it accessible by anyone in the world, both institutions and individuals. By making our user interfaces very easy to use and by implementing processes that enable ease-of-doing business for our Partners, we make gold trading accessible not only to the crypto traders, but to traditional gold investors, and people who are new to both markets. Blockchain technology enables Aurus to mitigate several frictions and limitations of the today s traditional gold markets, including the peer-to-peer trading, moving of the physical gold, or dealing with very small quantities (fractions of a gram). 33

34 The tokenisation of Gold by using blockchain allows AWG token holders to transfer fractions of coins instantly. This means that people can trade very small amounts of gold (even grams), enabling for the first time the usage of gold in a modern, day to day economy. DECENTRALISED SOURCES All AurusGOLD (AWG) DISTRIBUTOR Partners certified by the Gold Consortium will be able to integrate Plugins and APIs that allow them to buy and sell AurusGOLD (AWG) tokens at their own prices and according to their own supplies. This widens the availability of AWG and contributes to maintaining a stable value. STABLE VALUE ECONOMY In the eyes of influential economists, the perfect currency is one that is immutable in value. Throughout history, gold is the only asset that has proved itself worthy of holding a stable value. AurusGOLD brings that in the cryptocurrencies realm, offering investors and traders a hedge against the volatility of the crypto-markets. Moreover, AurusGOLD makes it possible and even easy to use a stable asset in the day to day economy. TRUST AurusGOLD (AWG) uses multiple components to ensure safety, stability and trust. The Ethereum public blockchain enables us to create a token that can be traded peer-to-peer without requiring the trust of a centralised entity to 34

35 manage. Since we re obligated to work with physical assets which need to be stored, it s impossible for us to be completely decentralised and therefore completely trustless. To help overcome this, we ve created the Aurus Gold Consortium, a group of highly influential minds from within the gold industry that will publicly assist us in maintaining the highest quality standard of operations and partners in the physical world. 35

36 8. Future Plans AURUS GOLD CONSORTIUM Gold traders and Gold Providers who work with Aurus to deliver this new future for gold will hold a place in the Aurus Gold Consortium. Each gold trader or provider will have a say in the future of the entire system. The mission of the Aurus Gold Consortium is to grow through strong and reliable gold traders and providers and to help shape the future of the industry from within. TRACING GOLD PROVENANCE Aurus proposes a supply chain blockchain solution to be made in parallel to our AurusGOLD (AWG) currency. We will use our blockchain expertise and the know-how and network of the Aurus Gold Consortium to provide a free and transparent solution to tracking gold through its supply chain, to assist in the efforts against money laundering, illegal mining and blood gold. A GOLD FUND FOR GOLDEN IDEAS Aurus will be allocating a portion of funds to be controlled by the Aurus BV shareholders and the Aurus Gold Consortium and invested in crypto-gold oriented startups and initiatives in order to support the growth and circulation of our stable value cryptocurrency: AurusGOLD (AWG). TOKENISATION OF UNDERGROUND GOLD One big dream for the long-term future of the Aurus Gold Consortium is to 36

37 potentially develop the capacity of correctly tokenising underground, unmined gold and allow it to be traded on a liquid market. We hope to reduce the need for gold mining, a process which is highly environmentally damaging and capital intensive. As the precision of geological evaluation evolves, we will be looking at the science of estimating underground gold reserve sizes, which may reach a point at which people will trust a currency backed by gold stored by mother nature. GOLDEN CHARITY We also aim to raise a charity to support areas which rely on gold mining as the main source of income. We strongly believe that at some point in the future, humanity will no longer physically mine gold and we hope to contribute to that dream. In doing so, economically, those areas will be in high risk and we aim to support them from early on to help them move away from their dependence on gold mining by investing mainly in education and development. STEP 2 AND ONWARDS Further to the introduction of gold as cryptocurrency, we aim to introduce tokens based on other valuable commodities and assets, such as silver, platinum and even less fungible valuables, such as art. By starting with gold, we can prove the worth of our asset tokenisation protocol and build the trust necessary to work with other valuable physical assets. 37

38 Disclaimer: At the time of writing this, the information provided in the whitepaper is based on the use of the Ethereum blockchain. In an effort to make the Aurus Gold Coin (AWG) as efficient as possible we will be experimenting with the EOS platform. Using this platform will potentially allow us to provide our users with lower fees and a more stable environment. It is important for early investors to note that depending on which blockchain we decide to use, the Main Sale for the Aurus Coin (AWR) might happen at a different time because we want to launch our main sale alongside our product. The information in this whitepaper is not final and is subject to change and revision in an attempt to make our product as viable as possible. 38

39 For more information visit