This post is a summary of ‘Talking Gold’ - a fortnightly update from Kinesis strategic advisor and resident gold expert, Andrew Maguire, providing a detailed round-up of the recent action in the gold market - a regular feature from the Kinesis Youtube show ‘Live from the Vault’. For the full analysis into the gold market, presented in illuminating detail, have a watch of the full segment of Talking Gold in Episode 11 of Kinesis’ ‘Live from the Vault’. In this episode’s weighing up of the gold and silver bullion market forces, gold expert, Andrew Maguire, shares industry word on the major Chinese banks set to establish a Loco London over-the-counter physical gold bullion market. For a detailed breakdown of CME and LBME’s collusion to restore paper market liquidity, have a watch of the week before last’s ‘Talking Gold’ from Episode 10 of Kinesis’ ‘Live in the Vault’. A physical gold bullion solution According to credible industry sources, major Chinese banks set to supply the physical gold bullion to back an over-the-counter physical gold London Metal Exchange (LME) market. A move that will cause the gold market conduit to migrate onto the competing physically-based precious metals exchange. The historic move from the Chinese banks would lower leverage from hundreds to one, accounting for derivatives, to around a more legitimate ten to one. A favourable ratio that would support the industry as a whole, while anchoring the over-the-counter gold trading to a real physical price. As is required in all physical exchanges, the new system would require that all physical gold bullion sits in the exchange, prior to sale. The physical gold solution will provide all necessary comfort and counterparty compliance assurances, and thus is expected to be embraced by all recently disenchanted over-the-counter liquidity providers. Who is supplying the physical gold bullion? Conveniently, the London Metal Exchange (LME) is owned by the Hong Kong Stock Exchange (HKEX), which is under the jurisdiction of China, and specifically, the People’s Bank of China. Liquidity provision would be overseen by the Industrial and Commercial Bank of China (ICBC), who will have no trouble at all from a physical liquidity perspective. ICBC already owns two Loco London vaults of unencumbered physical gold, following their 2016 purchase of the Barclays and Deutsche bank bullion vaults. The physical gold to back the over-the-counter LME market is on-site, in London and ready to be put to work. Which banks will join the new Loco London physical gold over-the-counter market? There is sufficient demand among both first-tier and second-tier banks to utilize a physically-based gold contract. A reliable industry source has revealed that one of the largest first-tier over-the-counter liquidity provider banks, Goldman Sachs, is preparing to price gold on a physical basis. The key over-the-counter liquidity provider has been going long physical gold for their own books for over 18 months, and they are not alone. All first-tier banks are long physical gold and silver for their own books, which means a higher gold price based on a physical gold market would prove universally favourable. The second-tier banks that were hung out to dry when the paper gold market broke will willingly switch their daily hedging facilities from the COMEX gold futures, over to this easily accessible and well located Loco London LME over-the-counter physical gold market. What does this mean for the price of gold? In this scenario, all officials will require a higher gold price to square up the current illiquidity imbalance. Andrew Maguire’s parting thoughts: I don't see China pricing their liquid contract much under $2200 US Dollars. Bottom line, we see gold at $2200 to $2500 based upon that structure, and what’s coming down the pipe. Next Episode: Andrew Maguire picks up the thread on the ongoing aftermath of CME’s attempt to shore up short-term market liquidity, with their suspect 4GC contract. Don’t miss out: Subscribe to the Kinesis Youtube channel
The integration of Kinesis technology has huge potential to increase business revenue and efficiency for companies of all sizes, across all sectors. Kinesis technology opens a company up to a series of unique, profitable revenue streams. As well as providing the security of holding company capital in the stable value of physical gold and silver, in the form of Kinesis gold bullion and silver bullion-backed digital currencies. 1. Mint and earn with Kinesis gold and silver digital currencies Minting is the profitable process of creating your own Kinesis gold and silver bullion-backed digital currencies, which has the capability of unlocking a new, recurring form of business revenue with unlimited earning potential for companies. How does it all work? All company capital minted into Kinesis digital gold and silver bullion-backed currencies, which is then transacted through the Kinesis system, earns a business a yield of gold bullion or silver bullion - for life. We call this the Minters Yield. Kinesis technology calculates the Minters Yield from a proportionate 5% share of global transaction fees, across the Kinesis network. How would this work for my business? 1. All company capital allocated for operating costs, such as wages, rent, utilities and materials, can be minted into Kinesis digital gold bullion and silver bullion-backed currencies.2. Next, a business uses that minted currency to make their routine payments through Kinesis payment technology.3. In this way, a business will earn a monthly yield, based on our global fee revenue, paid in Kinesis gold and silver bullion-based currencies on that minted currency, forever. Minting the company capital for day-to-day operating costs can significantly increase business revenue. Find out more about the 5 profitable yields unique to the Kinesis system here. 2. Create additional revenue from holding company capital in Kinesis gold and silver In a breakthrough in capital management, Kinesis technology allows a business to enhance business revenue with a passive yield on company capital. At the same time, protecting company capital from market volatility in the stable value of gold bullion and silver bullion. How can I increase my business revenue? Simply holding company capital in Kinesis gold bullion (KAU) and silver bullion (KAG) backed digital currencies, qualifies a business for another profitable yield - the Holders Yield. With the Holders Yield, a proportionate share of 15% of global transaction fees across the Kinesis network are deposited into your Kinesis account in physical gold or physical silver monthly, for as long as you hold your Kinesis digital currencies. Why should I store company capital in physical gold or silver? Gold remains the best-performing asset class of the 21st century, according to a recent analysis by Atlantic House Fund Management. Storing company capital in the stable value of physical gold bullion or silver bullion helps to shield company capital from the unpredictable fluctuations of Fiat markets. What’s more, Kinesis digital currencies enable a business to store company capital in physical gold and silver with no storage fees - ever. An industry first, made possible by allocating a percentage of Kinesis yields, coupled with our strong vaulting network. How can I access my gold bullion or silver bullion? All the while, a business maintains complete access to their physical gold and physical silver, through multiple, convenient access points: Simply, convert your physical gold or silver back into your currency via the Kinesis Exchange, and withdraw into your business bank account.Kinesis Debit Card - Spend Kinesis gold and silver-based digital currencies, anywhere in the world.Redeem your physical bullion directly (subject to minimum withdrawal requirements, charges apply) 3. Running a Business Payroll with Kinesis Operating payroll through Kinesis payment technology can diversify and increase business revenue. Kinesis introduces revenue streams in areas a traditional capital management approach would regard only as operating costs. As payroll is normally the largest of all operating costs, accessing the earning potential of the Holders Yield and Minters Yield, at scale, presents a considerable business revenue generation opportunity. Step 1: A business can access the Holders Yield by storing the company capital reserved for staff wages for a period of one month. Step 2: In distributing wage payments to all staff through Kinesis, the company activates the Minters Yield, on all company capital sent as wages. Step 3: For the purpose of payroll, a business would refer all staff members into the Kinesis system - this entitles the company to what is known as the Referrers Yield. The Referrers Yield entitles a business to a 7.5% share of each referred staff member’s transaction fees for life. So, a business earns a 7.5% share of: 0.22% fee every time an employee uploads funds onto a debit card.0.45% fee every time an employee sends funds with Kinesis. 4. Introducing Customers to Kinesis Introducing a business’ customer base into the Kinesis system is also a great opportunity to access the Referrers yield. Increasing business revenue, through the total revenue of a 7.5% share of all customer transaction fees. Every time a customer sends a payment or uploads funds onto their debit card, your business receives a 7.5% share of the fees, paid in physical gold or silver. 5. Onboarding Businesses to Kinesis Another profitable avenue to access the monthly revenue of the Referrers Yield, is onboarding suppliers and partnering firms into the Kinesis system.Signing up a fellow business could increase business revenue for your company considerably, entitling your business to 7.5% of every single payment of that referred business. Adopting Kinesis payment technology to manage day-to-day operating costs, gives businesses an opportunity to access Kinesis yields and increase business revenue, through unique revenue streams native to the Kinesis monetary system. Find out more here.
This post is a summary of ‘Talking Gold’ - a fortnightly update from Kinesis strategic advisor and resident gold expert, Andrew Maguire, providing a detailed round-up of the recent action in the gold market - a regular feature from the Kinesis series ‘Live from the Vault’. For the full analysis into the gold market, presented in illuminating detail, have a watch of the full segment in Episode 10 of Kinesis’ ‘Live from the Vault’. In this episode’s demystification of the gold and silver bullion market, gold expert Andrew Maguire offers a compelling insight into a transatlantic collusion between the London Bullion Market (LBMA) and the Chicago Mercantile Exchange (CME), in the wake of the broken paper market. As ever, our resident gold expert provides a refreshing wholesale market view of the reasons why physical gold bullion and silver bullion, priced in U.S. dollars, are set to make fresh highs. For a detailed breakdown of the major drivers that foreshadow the upcoming paper market reset, have a watch of the week before last’s ‘Talking Gold’ from Episode 9 of Kinesis’ ‘Live in the Vault’. LBMA collusion with CME With the over-the-counter related LBMA spot market broken, in an emergency attempt to restore paper market liquidity the LBMA moved to collude with a competitor, CME, who provide the platform for the US-centric futures market. LBMA and CME colluded to provide unallocated Loco London paper gold, as settlement for delivery obligations, with a new contract: the 4GC futures contract. LBMA and CME designed the 4GC contract to provide a band-aid replacement for the broken Exchange of Futures for Physical (EFP) safety valve; with the aim of giving LBMA and CME time to cover off massive underwater naked short offside bets. However, something is awry. The contract launched weeks ago - so, why has this contract not traded a single ounce of gold to date? Author: Marco Verch Image source: https://www.flickr.com/photos/160866001@N07/48880350827 Creative Commons 2.0 - https://creativecommons.org/licenses/by/2.0/ Where is the physical gold bullion? Despite the web of misinformation LBMA and CME have spun to assure their customers that gold spot and futures contracts are backed by physical gold bullion, as it stands: no Loco London 400-ounce bars have entered any CME Group vaults. So, where’s the gold bullion? The CME and LBMA have wheeled out a series of erroneous news reports, referencing bogus travel and insurance issues to explain why their phantom chartered aeroplanes full of 400-ounce gold bars are yet to arrive in New York. It is looking increasingly as if this contract is not fit for purpose and consists of little more than smoke and mirrors. Despite repeated inquiries, the CME and LBMA have refused to address our concerns. Why have CME members not been marketing this new 4GC contract solution? There are two reasons: Insider banks, including the Bank of International Settlements, BIS, that are privileged to access the EFP, (Exchange for Physical), conduit, have utilised this sole link between the futures market and the significantly larger over-the-counter foreign exchange spot gold market in London to: Earn immense profits (numbers to follow) Keep the paper capping game alive The 4GC has not been marketed to all traders, as it would render the existing EFP conduit pointless. The EFP conduit currently provides exclusive risk-free guaranteed profit for the first tier market-making US Bullion banks, which serves as an explanation for the colossal volumes getting cleared. Let’s have a look at some of the March profits in the EFP. Before the crisis on 23rd March, the March EFP volumes were netting insiders a daily $1.3 million risk-free profit, after costs. In the week after the crisis, insiders netted a risk-free guaranteed $413 million in just seven days of trading, with over 221 tons traded through the EFP. While the BIS has stepped in to try and manage the situation, industry insiders are still making a daily risk-free profit of $13.8 million, based upon the spread on April 23rd. Observing the vast profits, it is patently clear why the US traders don't want for the 4GC contract to sideline this insider cash cow. CME officials have done everything possible to weigh on paper gold, including raising margins, multiple times and the doubling of position concentration levels from 3,000 lots to 6,000 lots per trader. However, all actions are only a short-term attempt to shore up paper market liquidity, while insiders and officials move to cash settle and cover off as much mismatched paper to physical gold market dislocations as possible. Andrew Maguire’s parting thought: With physical gold in such strong demand, all parties need a higher US dollar price, including officials and the banks, who are definitely long for their own books. Next Episode: Andrew Maguire discusses this week’s options expiry and the Bank of International Settlements options expiry, and much, much more. Don’t miss out: Subscribe to the Kinesis Youtube channel Watch the full episode 10 of ‘Live in the Vault’ here - for the complete ‘Talking Gold’ segment and more updates from within the Kinesis system.
In what’s been a chaotic few weeks for every crypto market, the stable value of the gold price has presented cryptocurrency investors with a welcome opportunity to stabilise or diversify their existing investment portfolio. How to buy gold with Bitcoin, Ethereum or cryptocurrency? Many Bitcoin (BTC) and Ethereum (ETH) investors remain undecided on the best crypto exchange for trading between cryptocurrencies and precious metals. With Kinesis, it’s easy and low-cost to buy gold with Bitcoin or buy silver with Ethereum, or even trade between any of the 20 - and growing - trading pairs available. Bitcoin (BTC) will be made available for trading in the coming weeks, with Tether (USDT) being added to the list of markets available shortly. The Kinesis Exchange makes it as simple to trade crypto for precious metals as trading between cryptocurrency on any Bitcoin exchange. The Kinesis Exchange offers a gold and silver price competitive with the world’s leading physical bullion dealers, by offering the lowest price across our extensive network of vaulting partners spanning across 8 countries. When the time comes to re-enter the crypto market, simply exchange gold for Bitcoin (BTC/KAU) or silver for Ethereum (ETH/KAG), or whichever trading pair meets your needs. How does it all work? The purchased physical gold and silver is represented on the blockchain by Kinesis digital gold and silver-based currencies, KAU and KAG. It’s simple: 1 KAU = 1 gram of gold 1 KAG = 1 ounce of silver The purchased physical gold and silver bullion behind the Kinesis currencies is stored securely across Kinesis’ state-of-the-art vaulting network - with no storage costs. It's also important to note, we are not tying the price to 1oz of gold. In making units of gold available on the exchange by the gram, we make it easy for anyone to buy and sell gold. How much will it cost to store my gold or silver? There are zero charges for the storage of the physical gold and silver bullion behind Kinesis currencies. How can I access my gold bullion or silver bullion? Kinesis digital currencies combine the stability of the price of gold and silver, the flexibility of a cryptocurrency and the everyday convenience of a traditional fiat currency. As shown in the 4 ways to access your gold and silver: Kinesis Exchange - Exchange gold for Bitcoin (BTC) or Ethereum (ETH) or Tether (USDT), or vice versa, at any time. Kinesis Debit Card - Spend Kinesis gold and silver based digital currencies, as well as cryptocurrencies, anywhere in the world with the Kinesis debit card, or even withdraw funds in the local currency. Convert your gold back into your currency and withdraw into your bank account. Redeem your physical bullion directly (subject to minimum withdrawal requirements, charges apply) Access a unique yield with Kinesis gold bullion and silver bullion Holders of KAU (1 gram of gold) and KAG (1 ounce of silver) receive a unique monthly yield on their gold and silver, based on a proportionate share of 15% of global transactions fees - this is known as the Holders Yield. One of five unique yields available to Kinesis users, the Holders yield entitles holders of Kinesis digital gold and silver based currencies to a passive monthly income of KAU or KAG deposited into their Kinesis account, for as long as they hold gold or silver with us. Learn more about Kinesis yields here. How do I know my gold or silver is there? The physical gold and silver behind the Kinesis gold and silver bullion based digital currencies is: Fully allocated - Every KAU and KAG is backed by a 1:1 allocated quantity of gold and silver bullion stored in the Kinesis vaults. Fully audited - The gold and silver bullion behind Kinesis digital currencies is bi-annually audited by, leading independent global auditor, Inspectorate International. Learn more. Fully redeemable - All gold and silver bullion is fully redeemable, with legal title remaining with the holder, at all times - minimising counterparty risk. *subject to minimum withdrawal requirements. Why use the Kinesis Exchange? Low fees - A small 0.22% trade execution fee. Manage your portfolio in one easy-to-use interface - Buy gold with Bitcoin, Ethereum or Tether. Exchange 24/7 - No matter the time or place, all you need is a phone and internet connection, we are open 24. How to trade crypto for precious metals? Open a Kinesis account. Deposit your choice of either Bitcoin (BTC), Ethereum (ETH) or Tether (USDT) to your Kinesis account. Purchase either KAU or KAG from the Kinesis Exchange interface. The Kinesis Exchange makes it simple and low-cost to access the stable value store of the gold price and the silver price, and when it’s time to exchange gold for Bitcoin (BTC) or Ethereum (ETH), it’s only a click away. With the value, efficiency and ease of use of the Kinesis platform, any crypto investors looking for the best crypto exchange to trade crypto for precious metals, need look no further.
The ABN AMRO bank has abruptly closed all weight accounts for platinum, gold and silver bullion, leaving 2000 stunned precious metals investors with little more than thin air, where their physical gold bullion, silver bullion and platinum investment once was. The regrettable case of the Dutch bank reaffirms the absolute necessity of fully audited, allocated gold and silver to ensure verified bullion in physical gold or silver investment. The Dutch bank, ABN AMRO, presented customers with a short notice ultimatum: sell the platinum, gold bullion and silver bullion in your account before April 1st or the financial institution will sell it for you, with no guarantee of sourcing a fair price for the gold bullion or other precious metals. The unfortunate, if predictable, circumstances ABN AMRO customers are facing is a cautionary example of the counterparty risk investors, often unknowingly, accept with any investment in unallocated physical gold and silver. So, what happened at ABN AMRO? In 2013, the ABN AMRO weight accounts were transferred to another custodian. As UBS took over from Deutsche bank as the custodian of the gold and silver bullion, investors were informed by letter that their platinum, silver and gold bullion investment would be handled in a ‘different way’. The letter included a statement that, in so many words, customers could no longer redeem gold bullion, silver bullion or platinum. At the time, gold market analyst, Jaco Shipper, read the counterparty risk between the lines of the Dutch Bank’s hushed announcement. Shipper observed that although “ABN Amro denominates this account in terms of weight that is valued in euro, clients can never withdraw precious metals, so this denomination is entirely meaningless.” The financial institution held no allocated gold or silver bullion, Shipper labelled the precious metals “un-unallocated,” as “the invested funds may be anywhere and likewise the gold.” The Counterparty Risk According to the financial analyst, customers of the Dutch Bank invest in “any upside price potential of precious metals and whereby they take on all sorts of financial counterparty risks without hedging anything at all.” Shipper foresaw the possibility of a forced sell-off risk, commenting that “nobody can be held liable if these risks materialize.” When that risk did materialise, all counterparty risk of the investment landed square on the investors. Resulting in the forced sell-off of the, formerly, physical gold, silver and platinum by the end of the calendar month. What can we learn from the case of ABN AMRO? A harsh investment lesson for the ABN AMRO customers affected, serves as an important reminder for the rest of us: if a financial institution holds no allocated gold or silver, and the customer cannot redeem gold or silver, and it is the investor who takes on all counterparty risk and, ultimately, pays the price. Let’s look at the difference between Kinesis and ABN AMRO gold and silver bullion investment. Both Kinesis gold bullion and silver bullion are a fully audited, fully allocated gold and silver bullion investment, with the legal title remaining with the holder at all times. The result: almost no counterparty risk. Why is Fully Allocated Gold and Silver Important? If an investor can no longer redeem gold and silver bullion, the bullion investment becomes entirely notional, as they have no legal title to any physical gold bullion or physical silver bullion. As we can observe with ABN AMRO, without legal title, all counterparty risk is left with the investor, with potentially disastrous financial consequences. A fully allocated gold or silver investment is in tangible, physical gold bullion and silver bullion stored in secure bullion vaulting, with legal title remaining with the holder, minimising counterparty risk. Kinesis Fully Allocated Gold and Silver Investment Fully allocated physical gold bullion and physical silver bullion stored securely in the Kinesis bullion vaulting system, underpins all of the Kinesis digital currencies in circulation. As the legal title remains with the holder at all times, Kinesis has all but eliminated the counterparty risk that could lead to the calamitous situation at the Dutch bank. Fully Redeemable Gold and Silver Bullion Kinesis users can redeem gold bullion and silver bullion at any time. The physical gold and silver underpinning our digital gold and silver bullion based currencies can be delivered to our customers, upon request. *subject to minimum withdrawal requirements. Why are audits important? Audits provide investors with the peace of mind that the exact quantity of physical gold and silver is stored safely in secure bullion vaulting, as the financial institution managing the investment states. In the absence of fully audited gold and silver precious metals, customers are left in the dark about the quantity, quality and, as we have seen with ABN AMRO, even the existence of their physical gold and silver. Kinesis Fully Audited Gold And Silver Bullion All physical gold bullion and silver bullion, underpinning Kinesis digital currencies is fully audited by a global physical commodity audit and inspection specialist, Inspectorate International. Bi-annual third-party audits reassure Kinesis users that every last gram of physical gold and silver, behind Kinesis digital currencies, is stored safely within the Kinesis bullion vaulting system. We recently successfully passed our first of many bi-annual audits. Read up on the results here. Conclusion ABN AMRO customers are not the first to suffer the financial consequences of the counterparty risk that comes with unallocated, unredeemable and unverified gold and silver bullion investment; and they won’t be the last. Kinesis redeemable, fully audited and allocated gold and silver bullion investment has been designed with every possible precaution to prevent Kinesis users from experiencing the distressing events that took place at ABN AMRO.
The COVID-19 pandemic continues to wreak havoc across the global economy, collapsing crypto and stock market value without discrimination. Wall Street experienced its worst single day of trading since the 1987 crash, while the Ethereum and Bitcoin price were each slashed by around 50% - but what can we learn from such a black swan event? With investors the world over scrambling for a stable source of value, the recent economic turmoil has shone a light on the advantages of stable gold bullion based digital currency. Throughout this period of hectic trading, Kinesis digital currency has maintained price stability, through a 1:1 allocation with the timeless value of physical gold bullion. Yet again, the price of gold has proved its resilience in a period of great economic turbulence. While no market escaped the disastrous and far-reaching economic impact of the coronavirus pandemic, the gold price rebounded quickly. Let’s take a quick look at how the COVID-19 pandemic affected the stock market, the crypto markets and the gold market. Coronavirus Percentage Impact on Market(02/03/2020 - 26/03/2020) Bitcoin (BTC) -26.2% Ethereum (ETH) -39.06% Dow Jones (DJIA) -21.36% Standard & Poor's 500 -16.36% Gold (XAU) -0.60% https://www.coindesk.com/price https://www.kitco.com/charts/livegold.html Despite the gold market experiencing a dip due to a widespread lack of liquidity, the gold price (XAU) has now near completely stabilised. Whereas the financial impact of the coronavirus can still be seen in severe losses in the Dow Jones (DJIA) (-21.36%) and the Standard & Poor's 500 Index (S&P) (-16.36%) or in the Ethereum (ETH) (- 39.06%) and the Bitcoin (BTC) price (-26.2%). The strong response of the gold price to the coronavirus market crash cements Kinesis gold bullion based digital currency as an attractive proposition for all investors, whether searching for a short-term transfer of value or a stable, long-term investment. Even a glance at gold price history reveals why gold and silver bars are considered safe investments for the long term. The gold price continues to withstand the greatest economic challenges history presents, as gold price history seems to repeat itself. The innovative technology behind Kinesis gold bullion based digital currency makes accessing the stable value of gold bullion easier, cheaper and more profitable than ever before. But - why buy gold bullion through Kinesis digital currencies? Spend physical gold bullion: The Kinesis debit card allows you to spend gold bullion, how you would any other currency. Free storage of gold bullion: Access the value of gold bullion without paying storage fees - ever. Earn a yield: Receive a unique monthly yield on gold bullion based on a proportionate share of global transactions fees. Redeemability: Redeem the gold bullion underlying your Kinesis digital currency at any time. Liquidity: Access your gold bullion in seconds through our exchange, debit card or payments services. Fully Audited: All gold bullion is audited by a third party inspectorate. In these unprecedented economic times, all markets have been tested. While the coronavirus pandemic has exposed a concerning fragility across the economic system, with cracks appearing in every market; Kinesis digital gold bullion based currency has displayed true economic resilience. Kinesis digital currencies provide investors with a simple exit strategy from turbulent crypto and fiat markets, or an ideal long-term investment that prioritises stability over volatility. Kinesis digital currency offers all the benefits of a crypto currency, with none of the risk of traditional cryptocurrency, such as Bitcoin or Ethereum. Send Kinesis gold-based digital currency globally in seconds. Experience total accountability of all transactions on the blockchain. Decentralised system. Privacy. Scalability.