There’s long been a demand for on-chain precious metal tokens, and Liquid Noble is determined to be the project that will finally satisfy it. Set to launch in the first half of 2024, the company will offer full and auditable bullion reserves, fiat transfers with banking support, fast trading on its exchange platform, and physical delivery on request.
The Australian company has partnered with Sydney’s Custodian Vaults Pty Ltd. for its precious metal reserves, Australian Bullion Company (NSW) as its bullion supplier, and Tokenized to handle its wallets, trading platform, and tokenized assets. Further down the track are more consumer-friendly offerings that could see customers using gold-backed digital tokens as spending money. While Australia offers a robust legal and regulatory environment for the project’s various pieces, Liquid Noble also has more international ambitions.
We're proud to showcase our new precious metal reserve management system that automatically verifies and fills customer orders without any human intervention.
Buy gold in less than a minute! 🚀#GOLD #BSVBlockchain @Tokenized_com pic.twitter.com/hwYTexQG6n— Liquid Noble (@LiquidNobleInc) February 21, 2024
Precious metals on the blockchain—haven’t we heard all this before?
Digitized gold and other precious metals are one of blockchain’s holy grails, and the concept even predates blockchain (eGold, Liberty Reserve). The grail isn’t so much creating tokens from metal assets—that’s the “easy” part—it’s creating a system that works, is trusted, and satisfies existing regulations. Part of that is the unofficial competition to become the most used, the most trusted, and the most secure. The prize would then go to the project that becomes a household name, used and trusted by the masses.
On the other hand, those using a digitized gold network may be less interested in mass appeal. As long as they can buy, hold, and sell precious metals on a trusted exchange platform with adequate speed and liquidity, they’re content.
Liquid Noble starts out with the potential to satisfy both goals. It has the added benefit of running on the BSV blockchain, the only blockchain that can scale to an unbounded number of transactions with enough speed and cost-efficiency. It can handle the smart contracts needed to tokenize physical assets. Its transactions are secured by the more robust proof-of-work (PoW) processing algorithm, not proof-of-stake (PoS).
What sort of network has Liquid Noble put together? This is where third parties and other partners are important. There’s the contract/tokenization structure to handle the software side: exchanges, deposits/withdrawals, and token wallets. Then there are custodian vaults to secure the physical precious metal reserves, banks to provide reliable and quick fiat transfers, and liaisons with appropriate regulators to ensure everything’s legit.
Liquid Noble CEO: We’ll have our own precious metal reserves
CoinGeek spoke to Liquid Noble founder and CEO Dan Dragon about the project and what it’s taken so far to bring everything together.
One key difference between Liquid Noble and similar projects that preceded it is that Liquid Noble maintains its own precious metals reserves. That removes the need for a third-party broker and enables the company to build direct relationships with local suppliers.
“We invest in gold before we ever ask our customers to do the same,” Dragon said. “This is because we are committed to establishing trust and transparency with the hard-working people entrusting us with their investments.”
Liquid Noble acquires metals from Australian suppliers on a regular basis, depending on demand. Having its own reserves also brings benefits in bypassing the restrictions of gold market trading hours, allowing its customers to buy and sell 24/7 and on holidays. If demand surges suddenly, it can request additional metals from its suppliers for delivery within 24 hours.
It can also offer its own rewards to customers for loyalty and early adoption, plus occasional promotions based on its ability to get better-than-spot prices. Order fulfillment is automated and near-instant, with less than 10 seconds passing between a trade and gold tokens appearing in a customer’s account. As well as on-chain records, customers also receive email invoices and downloadable balance statements.
Dragon said Liquid Noble is optimistic about a public launch in May 2024. Its progress is on schedule and would actually be ready for launch in March—but the company isn’t taking any shortcuts with legal compliance and will launch as soon as (and only after) it receives all appropriate documentation and licenses from the Australian authorities.
Dragon noted the turnaround time for compliance is out of Liquid Noble’s hands, and the company will provide a more accurate timetable estimate in March. Customers can follow the project on X/Twitter, Facebook, and Instagram for updates. There’s a pre-registration
waiting list on the Liquid Noble website.
If you’d like to know details about Liquid Noble and what the experience would be like for users, check out our Q&A below:
What metals will be tokenized to begin with?
Gold, Silver, Platinum, and Palladium.
Is it possible to transfer the asset tokens between users, i.e., to use them as money transactions where accepted?
Absolutely. Our NobleGold, NobleSilver, NoblePlatinum, and NoblePalladium tokens run on smart contracts powered by Tokenized. This allows them to be sent, requested, and traded in the BSV blockchain ecosystem and any apps that support the Tokenized protocol.
In our next phase, scheduled for 2025, we intend to introduce physical debit cards performing real-time spot FX of your tokenized assets. This payment method will work for in-store purchases and offer merchants a way to accept payments directly in precious metals. That reduces their service fees and avoids any FX-related losses.
Who’s handling the liquidity/exchange on the back end?
For Phase 1 of our launch, Australian Bullion Company / ABC Bullion will provide our physical gold bars, coins, and other precious metals. Also, since we use general stock gold to back our currencies, they incur no storage fees and are fully insured at no additional cost to our customers.
Users can also convert their NobleGold into physical gold at any time, with a wide selection of bars and coins to choose from. As we believe in only providing the highest quality metals, all of our bullion products are refined and manufactured at the LBMA, SGE, and CME-accredited ABC Refinery, located in Sydney, New South Wales. The metals are then delivered to a location of their choice, fully insured by Custodian Vaults.
Please note that barring and delivery of their precious metals is fully insured and subject to a fee.
In most cases, the purchase of physical gold via Liquid Noble will be instant unless we’re in the process of topping up our reserves, which should take less than 24 hours.
The sale of physical precious metals will be performed via ABC Bullion, and the associated funds should become available in one to three business days.
In the future, we intend to connect with more liquidity providers. As we acquire the relevant licenses in the U.S., we will source local service providers there as well.
What jurisdiction/s are you based in? (Australia?)
Our initial launch is planned from Australia by our operating company, Liquid Noble Pty Ltd, which is in the process of being registered as a digital currency exchange with AUSTRAC.
It’s also worth mentioning that since we’re dealing with local Australian suppliers, there is a very high likelihood of us introducing a stablecoin for Australian dollars (NobleAUD) that will join the list of payment methods usable for all precious metal purchases.
What were the more challenging regulatory conditions or other requirements to get it approved?
Our key challenge right now revolves around processing and response times by the Australian government organizations.
Involvement of our U.S. parent company as a shareholder has significantly increased the complexity of all applications, and processes that usually take days have turned into weeks. However, we are optimistic that they will all be approved soon.
How simple/fast is the cash in/out (redemption) process?
Fiat deposits are converted to stablecoins in less than an hour upon receipt, and we intend to make this faster. Any additional delays are dependent on the customer’s bank and method of deposit (wire transfer, ACH, etc.)
Withdrawal of stablecoins back to fiat depends on the currency involved and the jurisdiction of the customer’s bank. Usually, they take one to three business days, which is pretty standard for our industry.
What third parties are you partnering with? (vaults, financial etc.)
Tokenized—We couldn’t do any of this without Tokenized, of course, our trusted partner and provider of smart contracts and token instruments.
Custodian Vaults—Our metal storage provider is Custodian Vaults Pty Limited (ABN 54 159 994 108), located at Lower Ground 74 Castlereagh Street, Sydney.
Australian Bullion Company—Our supplier of precious metals is Australian Bullion Company (NSW) Pty Ltd (ABN 82 002 858 602), a Pallion company, which is the largest precious metal services group in Australasia. Established in 1951, they’ve been around for more than 70 years and are extremely reliable and trustworthy when it comes to gold, as supported by their LBMA, SGE, and CME accreditations.
A Note on Banks—As you can imagine, until we are officially licensed as a financial services provider, it is hard to finalize a choice of bank, but we are in the process of negotiating with multiple parties.
Watch: Tokenizing assets on a scalable blockchain
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