Although the coins are created when the metal is secured in the vault, the coins are not linked to a specific bar number. Having a coin linked to a specific bar would create its own issues — the main ones being divisibility, redeemability and price.
Divisibility- a coin created linking to a specific bar could not be divisible.
Example – If its a 1 kg bar it could never be divided or redeemed in any other size or quantity. The point of using tokens for physical assets is divisibility and easy transfer.
Redeemable- In order to make the tokens easily redeemable, its necessary to be able to swap metal from the vault to the vaults partners so it can be shipped most places in the world efficiently is necessary or for example a local provider to lets say redeem a silver coin in a coin shop for a assetbase silver token.These swaps or efficient redeemability would not be possible if the Assetbase token was linked to a specific bar number defeating the usability and redeemabliity of the token.
Price- In order to keep the price of each token to a minimum the precious metal must be bought in larger bars silver 100oz or larger and all the other metals 1 oz or larger. The real point of an asset token to make a larger asset divisible and transferable.
Coming Soon: Proof of Secure Asset Protocol
Using POSAP, you’ll be able to:
- create your own personalized asset tokens
- issue out tokens (or anything else, really)
- link to each coin or bar
- stay flexible