@
Mordan, @
dannno,
I agree with you about Bitcoin needing less trust that a gold-backed stablecoin.
I'd only correct you, just to safe face, when you talk about banks holding the metals.
It doesn't need to be a bank.
The second point is, what if confiscation.
This danger exists for bitcoin too.
What if Govs declare trading of bitcoin illegal. Buying with bitcoin is illegal, just the act of offering bitcoin in exchange of good or services is illegal.
Accepting bitcoins as a means of payment is illegal. Just showing the readiness of accepting bitcoins to that purpose is illegal.
That would make bitcoins as a currency, useless.
"What happens when a government comes in and confiscates the gold that the crypto is backed by?"
If the metal is managed by an organisation with multiple vaults around the world, in this case they would move the metals out of the country and into a vault in another country.
For example, in case of the gold-backed stablecoin Kinesis, the organisation managing the metals is the Allocated Bullion Exchange, with vaults in 7 locations around the world.
I like their inventory management, particularly the Inspection and Audit Section
https://abx.com/technology-services/storage-logistics/
But I don't trust Kinesis because of that. Basically I trust them because among their Advisers there is Andrew Maguire, who was a whistleblower at the CFTC during the investigation about the manipulation of the gold and silver market.
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