LFP199 – Gold, Have a Personal Gold Standard & Pay in Gold #Fintech #GoldTech w/Jason Cozens CEO Glint

Gold has been much in the news recently with Russia putting a Gold-floor under its currency to spectacular effect (almost as if desire for infinitely printed fiat paper is wearing off…) and offering to accept payment for exports in Gold the US sanctions/de-SWIFTing/and theft of Central Bank Assets (never happened in history) has spectacularly backfired. But what if you too could have your own personal Gold Standard, backing your cash with what has been real money for millennia? What if you could pay buddies directly with Gold? Is Gold the ultimate anti-CBDC? Glint’s mission is to create a gold-based alternative to banking and money and so is highly relevant right now.

In the bigger picture this episode can be seen as a part two to LFP197 with maneco64 which was snappily entitled: “Money in the 21stC: Ballooning Printing of Fiat/QE/”MMT”/Govt Debt, CBDCs, Crypto, Dedollarisation, Hyperinflation and Gold” in which we only had a short time to touch on Gold.

Jason’s Glint has, after thousands of years, provided a new functionality (or perhaps two or three new functionalities depending on how you count) to the gold would you believe it. Fintech (GoldTech?) at its best.

Back in the early days of the podcast 2014-15 I spoke to one or two folk who were working on gold and fintech in one way and another but no-one really cared much. Perhaps everyone and especially me should have as since 2014 Gold is up 60% (and in passing about 60-fold since the US came off the gold standard in the early 70s).

I’ve been looking into Gold since and it is far more weird/complex as a market than I ever realised… When we were young we would have known gold as perhaps rings on our mothers finger. A little later we might know it as something in the periodic table with certain properties. But that leaves much unsaid – what is golds function in society? If we want to invest in it how do we do that – ie what are the investable forms of gold? Indeed is gold an investment as such or a store of value? How well does it fulfill either role? Can we use it for payments (an amazing functionality Glint Pay puts on your phone)?

So for some of you out there this might not be just another podcast but one that makes you consider whether you should invest a certain part of your portfolio in Gold – whether through Glint, bullion dealers, ETFs, coins or many other ways.

Topics discussed include:

  • on the day of the recording the FCA shut down all Bitcoin ATMs as illegal
  • Jim Rogers (~4,700% return in the 1970s on his Quantum fund) predicting that the weaponisation of the dollar will mark its end
  • ~14,000 crytpos out there these days
  • the “interesting times” we live in
  • Jason’s background as an architect/tech/entrepreneur and study in Gold starting in 2008
  • his realisation that any money you put in the bank becomes the banks property with you having just a claim on the bank – hence how to safely store value
  • inflation’s erosion of paper money’s real value
  • realising Gold was the historic answer but we are unable to use it as payments
  • the long journey to Glint today from 2008 given so much to learn
  • Glint Pay Ltd created in 2015, prototyping a gold-based alternative to banking and money
  • the immense value to Glint of having excellent NEDs on the Board
  • launched to customers in UK & Europe end of 2018, in the US in 2019
  • the amazing number of perceptions of Gold – Jason’s perspective
  • when you own Gold – correctly – it is, unlike money no-one’s liability
  • Gold price volatility – short-term, long-term
  • the bizarre medium-term fluctuations since 1973 in the price belie the simple view of “an inflation hedge” over the medium-term, even if over the longer term it is the way of preserving value
  • how to buy Gold is not so simple – allocated/unallocated, premia, Gold coins can be CGT-free
  • a deep dive into ensuring that when you buy Gold you actually own it
  • deep-dive into unallocated Gold – you don’t have a legal title (cf cash in a bank) – Jason said that most Gold people buy is unallocated without realising
  • some cryptos are backed by unallocated Gold (&sometimes in Govt vaults adding a further layer of “legal distance, potentially problematic”)
  • comparison of allocated/unallocated with eg money in a bank or cash in a bank safe deposit box – in former case you don’t “own” your money in the latter case you legally do
  • following the above “Gold does not give a yield” is as you don’t own your money – if it was “under the bed” or in a safe deposit box your cash would not have a yield
  • extreme version of allocated is to have Gold “in your hands” ie at home however NB problems of storing precious metals at home – nickable and not insurable (generally/above small levels)
  • vaulted and insured as safest levels
  • ETFs – not all hold Gold, many lend it out and others use futures to replicate the performance (a whole episode in itself) but ultimately you are still owning a share not directly owning precious metals)
  • the catastrophic LME cancellation of trades in Nickel futures recently as an example of the risk of using futures to replicate real prices
  • premia – bullion/coins right now are around spot+5% to buy  and spot-2% to sell 
  • Glint charge spot+0.5% to buy and spot-0.5% to sell or if you use your Gold to spend via their MasterCard attached to the account you sell at spot – way better spreads
  • Glint has multi-currency accounts in the app as well as MasterCard and ability to buy Gold, payments coming later this year
  • averaging-in as the standard way to mitigate short-term volatility when building up a position
  • a full explanation of how Glint works in terms of storing the money in Gold in Brinx vaults under Geneva airport and what happens when you tap your MasterCard to buy something
  • Glint has ~$100m value of Gold in the vaults right now – nearly two tons! (&a ton of Gold is roughly the same weight as a baby humpback whale!)
  • paying other people on the Glint network directly in Gold – a Gold-based alternative to banking payments
  • storage charges 0.24% pa on Gold
  • Glint customer balances vary between £50 and £2m – ~100,000 customers with an average of $4,000; getting a thousand registrations a day
  • Glint wealth-managers platform – second platform after the retail app
  • later this year API-able
  • Trustpilot 4.7*
  • can download in 200 countries – not Europe right now (post-Brexit) but will be by the summer

And much more more 🙂

Share and enjoy!