The CACHE Gold Standard

Not all gold is created equal when it comes to liquidity, taxation and compliance.

In bullion terms, there are three broad types of gold:

  • Branded Refinery Gold – Includes extensive controls on the gold’s origin
  • Junk gold – Gold jewelry and pellets for industrial use of various purities
  • Unmarked Gold – Illiquid, trades at discount and may have AML/CFT issues

Gold spot prices refer to the branded refinery variety. Because CACHE can tokenize gold for third-parties which can later be redeemed, it is important to maintain a minimum quality standards, which for CACHE, requires highly liquid, branded refinery gold.

The CACHE Gold standard prevents deposit of unmarked gold with the intention of withdrawing branded gold. CACHE also advises users against depositing minted gold coins because CACHE values the pure gold mass irrespective of premiums. This means the premium typically paid for coins over bars would be lost and other CACHE Gold token holders would have the opportunity to earn a riskless profit by redeeming their tokens for coins instead of bars.

CACHE Gold will be primarily backed by 1 KG branded gold bars since 1kg bars are a good compromise between low premiums and a practical minimum redemption value. 400 troy ounce good delivery bars and 100 grams are also expected to back CACHE Gold, however, redemptions will likely target bullion with the highest premiums resulting in 100 grams bars being redeemed first and leaving 1 KG and 400 troy ounce good delivery bars as the majority of CACHE Gold’s backing.

It is important to note that not all branded gold bars are uniform. The LBMA good delivery rules state that LBMA good delivery bars can vary between 350 to 430 troy ounces in weight and must have a minimum purity of 99.5%. Described below are the rules CACHE Gold implemented to ensure bars of different purities and weights are valued fairly and consistently.

Gram Determination

Since CACHE Gold operates on a pure gram basis rather than a troy ounce basis, it must consistently convert troy ounces to pure gold grams. This conversion uses the LBMA Conversion ratio between grams and troy ounces of 31.1034768 (7-digit precision).

GramChain® uses 2 digit precision to provide 1/100th of gram precision. Bars will therefore be rounded to 100.00 or 100.01 grams. This precision is exceeds the +/- 0.05g variation allowed by the Shanghai Gold Exchange and is equivalent to the LBMA 0.00032 troy oz variation standard as well.

A troy ounce gold bar is converted to grams:

  • 10 troy oz = 10 x 31.1034768 = 311.0348 grams - rounded to two digits (311.03)
  • 1 troy oz = 1 x 31.1034768 = 31.10348 grams - rounded to two digits (31.10)

Pure (Fine) Gram Determination

Purity variations are addressed by multiplying the gross bar weight times the stated purity. Therefore, a 400 troy ounce 99.5% pure bar would be 398 pure troy ounces whereas a 400 troy ounce 99.99% bar would be 399.96 pure troy ounces.

Secondary alloyed metals are ignored as only gold is measured. This is another reason not to deposit 92.5% gold purity American Eagle gold coins as their silver content balance will not be recognized.

GramChain® follows the LBMA purity rounding practice which truncates (rounds down) by default, unless the decimals to be truncated are 9 or more, in which case they are rounded up.

For example, a gold bar’s gross weight at:

  • 1,000 grams with 9999 purity would be 999.90 pure grams.
  • 10 grams with 999 purity would be 9.99 pure grams (10 x 0.999 = 9.99)
  • 10 grams with 9995 purity would also be 9.99 pure grams (10x 0.9995 = 9.995 rounded down)
  • 10 grams with 9999 purity would be 10 grams (10x 0.9999 = 9.999 rounded up)

Brand List

Any gold refineries on the LBMA list are accepted by CACHE Gold as are several reputable non-LBMA refineries and national mints. Sunshine Mint, for example, is a major provider of gold blanks to the US mint, is not an LBMA member but is accepted by CACHE Gold.

Branding filters are enforced via the GramChain® scanner directly at the vault at the time of scanning and later verified making it impossible to deposit gold bars that are not on CACHE Gold’s list of accepted refineries. It is possible for a brand to be added to the list upon request. Contact us at [email protected] to request an addition.

Refineries sometimes make custom bars as a white label service using other names. Such bars are acceptable as long as the refinery hallmark is present, clearly visible and the refinery is on CACHE Gold’s list of accepted refineries.

Currently the following brands are accepted:

  1. ABC Bullion (ABC) - ABC Refinery (Australia) Pty Ltd
  2. AGR Matthey (AGR) - AGR Matthey
  3. Al Etihad Gold (ALETIHAD) - Al Etihad Gold Refinery DMC Dubai
  4. Logam Mulia (ANTAM) - PT Aneka Tambang (Persero) Tbk (Logam Mulia)
  5. Argor-Heraeus (ARGOR) - Argor-Heraeus SA
  6. Asahi (ASAHI) - Asahi Refining / Asahi Pretec
  7. Austrian Mint (AUSTRIAN) - Muenze Oesterreich AG
  8. Banco de Mexico (BMEXICO) - Banco de Mexico
  9. Bangko Sentral (BSP) - Bangko Sentral ng Pilipinas
  10. Credit Suisse (CSUISSE) - Credit Suisse
  11. Degussa (DEGUSSA) - Degussa-Huels AG
  12. Emirates Gold (EMIRATES) - Emirates Gold DMCC Dubai
  13. Engelhard (ENGEL) - Engelhard Industries Pty Ltd
  14. Heraeus (HERAEUS) - Heraeus Deutschland GmbH & Co. KG
  15. IGR (IGR) - Istanbul Gold Refinery
  16. Ishifuku Tokyo Melters (ITM) - Ishifuku Metal Industry Co., Ltd.
  17. Jiangxi (JIANGXI) - Jiangxi Copper Company Ltd
  18. Johnson Matthey (JM) - Johnson Matthey
  19. LBMA good delivery bars (LBMA) - LBMA BAR
  20. LS Nikko Copper (LSNIKKO) - LS Nikko Copper Inc
  21. Matsuda Sangyo (MATSUDA) - Matsuda Sangyo
  22. Metalor (METALOR) - Metalor Technologies SA
  24. Nadir (NADIR) - Nadir Metal Rafineri San. ve Tic. Ltd.
  25. Ohio Precious Metals (OHIO) - Ohio Precious Metals, LLC
  26. Pamp (PAMP) - PAMP SA
  28. Perth Mint (PERTH) - Perth Mint
  29. Philoro Edelmetalle GmbH (PHILORO) - Philoro Edelmetalle GmbH
  30. People's Republic of China (PRC) - People's Republic of China
  31. Rand (RAND) - Rand Refinery (Pty) Ltd
  32. Royal Canadian Mint (RCM) - Royal Canadian Mint
  33. Republic (RMC) - Republic Metals Corporation
  34. The Royal Mint (ROYALM) - The Royal Mint Limited
  35. Swiss Bank Corporation (SBC) - Swiss Bank Corporation (Metalor)
  37. SKS (SKS) - Shuikoushan Nonferrous Metals Group Co Ltd (SKS)
  38. Solar (SOLAR) - Solar Applied Materials Technology Corp.
  39. Sunshine Mint (SUN) - Sunshine Minting, Inc.
  40. Tanaka (TANAKA) - Tanaka Kikinzoku Kogyo K.K.
  41. TXY (TXY) - Sichuan Tianze Precious Metals Co., Ltd
  42. Umicore (UMICORE) - Umicore SA Business Unit Precious Metals Refining
  43. United States Mint (USMINT) - United States Mint
  44. Valcambi (VALCAMBI) - Valcambi S.A.

Important Notice:

CACHE Gold was founded in 2018 to digitize, by issuing fungible ERC-20 tokens, uniquely tracked gold bars in a transparent and fully backed manner using GramChain asset tracking system, thus providing a real-time and tamper evident Proof of Reserve (PoR).

Our approach was compliant to the definition of an asset-backed-token under the Singapore Precious Stones and Precious Metal Act (PSPM Act) as administered by the Singapore Ministry of Law.

In mid-2023, Singapore Ministry of Law announced the proposal to amend the PSPM Act whereby “the definition of asset-backed token will be updated to exclude digital payment tokens” and that “[sale of] tokens backed by gold to a customer after the effective date of this amendment, will not fall within the scope of regulated dealing under the PSPM Act.”

With these changes, gold backed tokens, from a regulatory perspective will be regarded as securities under the Monetary Authority of Singapore (MAS). MAS securities regulations makes the issuance, distribution and trading public blockchain tradeable tokens impractical.

This shift removes the regulator assurance of issuing new CACHE Gold Tokens in Singapore and as a result, CACHE Gold has made the difficult decision to enter indefinite dormancy, with the aim of just facilitating the redemption/conversion of any remaining tokens.

If you hold any outstanding CGT, please contact us at [email protected] for guidance on CGT redemption/conversion.

CACHE Gold has consistently maintained more than 100% backing for its tokens and possesses adequate net assets to responsibly close operations, settling all liabilities. We have actively reduced outstanding tokens and hold only a minimal number of third-party tokens.

We deeply regret being unable to realize our vision of issuing highly transparent public blockchain gold tokens.