Precious Metal Register With Blockchain Ownership Transfer
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Solution Overview
Problem
Current methods for owning, storing, and trading physical gold and other precious metals face significant risks and complexities, including authenticity verification, security, storage, and compliance with international regulations, making it difficult for individuals and institutions to manage and transfer these assets efficiently.
Innovation Solution
A system utilizing a secure environment public register (SEPR) that includes secure storage facilities, blockchain-based ownership documentation, and certified precious metal units with unique identification, enabling secure transfer, storage, and trading of precious metals while adhering to regulatory requirements.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If physical gold is stored in a bank's physical holding, then security and storage are improved, but access and transportation complexity increases
Solution Approach 1:
The patent creates a digital copy (token) that represents ownership of physical gold. This token can be transferred electronically without physically moving the gold, simplifying access and transportation while maintaining security through the underlying physical asset.
Solution Approach 2:
The patent introduces a trusted intermediary system (the tokenization platform and custodian) that mediates between the physical gold storage and the owner's access needs. This intermediary manages the physical asset while providing digital access mechanisms.
2Adaptability or versatility
If physical gold is held offshore in another country, then diversification is improved, but access and transportation difficulty increases
Solution Approach 1:
The digital token representation allows owners to access and transfer their gold holdings electronically regardless of physical location. This eliminates the need for physical transportation when accessing offshore holdings, making diversification practical and accessible.
3Productivity
If a facility sells pieces of a large gold block, then liquidity is improved, but risk of over-selling increases
Solution Approach 1:
The patent creates unique digital tokens that represent specific portions of physical gold assets. Each token is individually tracked and registered, ensuring that the total number of tokens issued cannot exceed the underlying physical asset value, thus preventing over-selling while maintaining liquidity.
Solution Approach 2:
The system implements a registration and tracking mechanism that provides real-time feedback on the relationship between issued tokens and underlying physical assets. This ensures transparency and prevents facilities from issuing more tokens than the physical gold can support.
4Adaptability or versatility
If person-to-person transfer of physical gold is enabled, then ownership transfer flexibility is improved, but security risk increases
Solution Approach 1:
The patent enables transfer of digital tokens representing gold ownership through electronic means. This allows person-to-person transfer with the flexibility of digital transactions while eliminating the physical security risks associated with transporting and handing over actual gold.
5Adaptability or versatility
If transportation of physical gold is enabled, then asset mobility is improved, but security risk and cost increase
Solution Approach 1:
The digital token system allows instantaneous electronic transfer of gold ownership without physical movement. This provides asset mobility equivalent to or exceeding physical transportation while eliminating security risks and costs associated with physically moving gold.
Data Source
AI summary
A Secure Environment Public Register (SEPR) provides a method and system that allows precious metals in the shape of bar(s) or units to be certified, specially numbered to provide exact linkage to an owner, allow secure movement of precious metals between secure facilities, and though Blockchain allow secure transfer of ownership between individuals and organizations. The SEPR allows gold and other precious metals to be easily held and traded in commerce with all the advantages of holding precious metals. The SEPR system allows exact audits of the metal bars on hand and avoids over-selling units since each bar is serialized and ownership is documented in a public register.