This year, the RWA track has been continuously developing. In addition to established DeFi platforms like MakerDAO and Aave, many native protocols have emerged. RWA may not only become the main narrative of the next bull market, but also serve as a bridge between the crypto market and mainstream finance, bringing in the vast traditional capital into the crypto market. RWA stands for Real World Assets Tokenization, which is the process of converting the value of equity in tangible or intangible assets (which can be ownership, income rights, usage rights, etc.) into tokens. RWA can represent many different types of traditional assets (including tangible and intangible assets), such as commercial real estate, bonds, cars, and almost any asset that stores value and can be tokenized.
Various public chains are actively responding to the RWA narrative by launching RWA protocols related to real-world assets. The RWA story in the Internet Computer ecosystem also starts with Gold DAO.
Recently, the IC ecosystem has gained widespread attention due to the new paradigm of decentralized writing protocol Mora, and the memetic coin project IC Ghost has contributed to the experiment of inscriptions. Additionally, SNS, which has not launched a new project in nearly a month, has regained vitality due to Gold DAO's 5-hour achievement. At the time of writing this article, Gold DAO is conducting an SNS Swap to sell governance tokens. In the Gold DAO Telegram group, there are many new IC chain users inquiring about how to purchase governance tokens on SNS.
What is Gold DAO?
Gold DAO, Gold+DAO, brings gold into the Web3 world.
There are many types of gold products available on the market, and traditional ways of investing in gold usually include purchasing physical gold, investing in gold ETFs, and buying shares of gold mining companies. Each method has its advantages and disadvantages, such as storage issues with physical gold, management fees and indirect ownership issues with gold ETFs, and the dependence of gold mining company stocks on company performance. These factors often make it cumbersome for people who want to buy, hold, and sell gold.
Gold DAO is a gold RWA project initiated by DAO.Link and built on the Internet Computer using blockchain technology, aiming to digitize and democratize gold, allowing people around the world to trade physical gold safely and fairly, bypassing traditional trading markets. Upon further investigation, DAO.Link is a Swiss company jointly established by Bity SA and Slock.it, aiming to assist investors in recovering funds from The DAO's 2016 hack.
As a decentralized autonomous organization (DAO), Gold DAO is composed of contributors from entities and individuals distributed around the world, with major contributors including:
DAO.link acts as the decentralized entity of Gold DAO and has issued gold NFTs based on the ORIGYN NFT protocol. The company is regulated by the Swiss Financial Market Supervisory Authority (FINMA), acting as the custodian of physical gold and providing a channel for NFT holders to redeem physical gold from the vault.
ORIGYN Foundation is the developer behind the ORIGYN NFT protocol, a significant contributor to the gold NFTs. In addition, ORIGYN has donated 500 million OGY tokens to Gold DAO SNS to increase the adoption of the ORIGYN protocol as an RWA platform.
NFT marketplace YUMI is the primary trading front-end for gold NFTs. With the evolving regulatory environment, YUMI's KYC process provides Gold DAO with the necessary compliance framework.
After the SNS Swap, governance token holders can actively contribute by adding code or products, participate in governance, and share in the protocol's future income.
Gold DAO Ecosystem
The Gold DAO ecosystem consists of four parts: GLD-NFT (gold NFT), GLDT (gold token), USDG (gold-backed stablecoin), and GLDGov (governance token).
1. GLD NFT
Gold DAO's first product is the gold NFT—GLD NFT, which has already been launched. GLD NFT represents direct ownership of physical gold stored in the vault. GLD NFT holders can redeem physical gold at any time. The physical gold in the vault is audited quarterly by KPMG. In this way, Gold DAO provides investors with a simpler way to trade physical gold.
Each GLD NFT is issued based on the ORIGYN protocol and contains ownership certificates, casting information, images of the associated gold bar, description, gold bar authenticity certificate, specifications, and storage proof. All data and information are completely stored on the chain.
In summary, GLD NFT has the following characteristics:
- Secure custody: Gold DAO has established a secure custody system to store physical gold.
- Asset digitization: After securely storing physical gold, Gold DAO issues NFTs through the ORIGYN protocol, achieving the digitization of gold.
- Custody verification: To maintain authenticity and trust, Gold DAO implements custody verification mechanisms, conducting regular audits and verifications to ensure consistency between physical gold and NFTs.
- On-demand redemption: NFT holders can redeem physical gold at any time.
2. GLDT
As a bridge between physical gold and the digital ecosystem, Gold DAO introduces the gold token—GLDT. GLDT is a divisible token representing 1/100 or 0.01g of a gram of gold.
GLDT can be exchanged with GLD NFT through smart contracts. For example, a GLD NFT representing 1g of physical gold can be exchanged for 100 GLDT, and conversely, destroying 100 GLDT can be exchanged for 1g of GLD NFT.
In summary, GLDT subdivides indivisible GLD NFTs, enhancing the on-chain liquidity of gold and providing users with a new way to trade small amounts of gold. According to the official roadmap, GLDT tokens and GLDT Swap will be launched in the first quarter of 2024.
3. USDG
The value of stablecoins supported by fiat currencies such as USDT and USDC is pegged to bank deposits in US dollars. Due to the Federal Reserve's annual inflation target of 2%, the purchasing power of these stablecoins is constantly decreasing, making them susceptible to inflation risk. On the other hand, stablecoins supported by crypto assets like DAI rely on assets such as ETH as collateral, and due to the volatility of ETH prices, they carry high liquidation risks.
Compared to other stablecoins, gold-backed stablecoins can solve these problems. The price of gold has doubled in the past twenty years, and using gold as collateral to mint stablecoins not only provides protection against inflation, but also offers relatively stable short-term prices and lower liquidation risks. Therefore, gold is an ideal collateral for stablecoins.
Building on physical gold, GLD NFT, and GLDT, Gold DAO has created USDG, an over-collateralized stablecoin with GLDT as collateral.
The mechanism of USDG is as follows:
Users can use GLDT as collateral to mint USDG, creating collateralized debt positions (CDPs) with a minimum collateral ratio (CR) of 150%. When the CR falls between 110% and 150%, CDP holders will be unable to mint additional USDG. To maintain the stability of USDG's price, Gold DAO has created a stability pool where users can pledge USDG. When a CDP holder's CR falls below 110%, the stability pool will deduct GLDT from the CDP and destroy an equivalent amount of USDG. The deducted GLDT will be proportionally distributed to the stability pool pledgers as a reward. To further encourage users to pledge USDG to the stability pool, Gold DAO will airdrop a certain number of governance tokens to the pledgers.
Another mechanism to maintain the stability of USDG's price is the redemption channel, which allows arbitrageurs to redeem 1 USDG for an equivalent amount of GLDT from the CDP with the lowest CR.
In summary, USDG has properties of inflation resistance and price stability. Currently, the IC ecosystem urgently needs a trusted native stablecoin, so the launch of USDG is expected to change this situation. According to the official roadmap, USDG will be launched in the third quarter of 2024.
4. GLDGov
Currently, Gold DAO is conducting the sale of governance token GLDGov through the Service Nervous System (SNS). SNS is the launchpad infrastructure of the IC chain, aiming to provide DAO governance solutions for application developers who are unable to implement them on their own, enabling token issuance and DAO deployment with just one click.
Economics of GLDGov token:
- Total supply: 1 billion tokens
- Deflationary mechanism: a 0.001 GLDGov fee is burned for each transaction/transfer, and 1000 GLDGov tokens are burned for each failed proposal
- SNS community fundraiser: 200 million tokens (20% of total supply)
- Development team: 180 million tokens (18% of total supply), linearly unlocked over 24 months
- SNS treasury: 620 million tokens (62% of total supply), used for strategic development, marketing, partnerships, and community incentives. The use of treasury funds must be approved by SNS voting.
After the launch of the governance token, users can participate in SNS in various ways and benefit from it:
- Propose plans that can guide the future development of Gold DAO and contribute to the development of Gold DAO through governance participation
- Stake tokens to earn governance rewards through voting
- Contribute as a developer to expand products for Gold DAO
- Assist in marketing for Gold DAO
In addition to earning governance rewards through governance participation, GLDGov stakers will also share in the future income of Gold DAO, as well as the 500 million OGY tokens donated by the ORIGYN Foundation mentioned earlier.
It is worth mentioning that Gold DAO started the token sale at 8:00 PM Beijing time on December 13th, and within 22 minutes, 112,000 ICP tokens were purchased. In just 5 hours, the minimum target of 200,000 ICP (worth approximately $1.26 million) was reached, making it the fastest SNS project to reach the target in the past three months. There are 13 days left until the token sale ends, and Gold DAO is expected to quickly reach the hard cap of 750,000 ICP. Please be aware of the risks when participating.
Exclusive Interview with Gold DAO
Recently, the Baize Research Institute conducted a brief online interview with Julien Aerni, CEO of DAO.Link, to discuss the future of Gold DAO and their views on RWA on the IC chain.
1. Please introduce yourself and your team.
Gold DAO is developed by individuals and companies from different countries. For more information about the core members of our team, you can visit our Twitter, where we have conducted brief video interviews with them, including our CTO Dustin and our token economics expert Yulin.
2. Why did you choose to build Gold DAO on the Internet Computer?
We chose the Internet Computer primarily because the ORIGYN protocol built on it has unique capabilities to create ownership certificates, and all data is directly stored on the chain. Our vision for Gold DAO extends to cross-chain and multi-chain, and we understand the importance of integrating with other ecosystems. Another reason for adopting the Internet Computer is its SNS system, which is crucial for launching DAOs. It aligns well with our goal of ensuring that Gold DAO remains decentralized and prevents any single entity from owning or controlling it.
3. What stage is Gold DAO's development currently at?
In the Gold DAO ecosystem, GLD NFT is already operational on the Yumi Marketplace. The smart contracts for GLDT and GLD Swap are in the auditing stage. With the launch of Gold DAO SNS, investors will receive governance token GLDGov to participate in governance. We are actively developing USDG, involving collaboration with multiple experts.
4. Can you provide a detailed explanation of how GLD NFT operates?
The key difference between GLD NFT and other gold tokens is its non-fungibility. It is based on the ORIGYN protocol, which directly stores high-quality images and data on the blockchain. This approach is in stark contrast to NFT standards that may rely on external servers such as AWS for data storage. Directly storing information on the blockchain ensures its immutability and trustworthiness. A key aspect of the GLD NFT mechanism is the use of gold bars from the Swiss-based Metalor Group, each with a serial number, making the process of anchoring gold to NFT effective and reliable.
5. Can users mint GLD NFTs themselves?
In the future, only entities with gold sales licenses will have the ability to mint GLD NFTs. This approach is necessary to ensure the quality of the gold, and it is a key reason for our collaboration with Metalor.
6. GOL NFT is minted based on the ORIGYN protocol, so what is the relationship between GLD NFT and OGY tokens?
The minting process of GLD NFT is closely linked to OGY tokens. To mint GLD NFTs, a certain amount of OGY tokens needs to be burned. The connection between GLD NFT and OGY tokens is crucial for the functionality and reliability of the Gold DAO ecosystem.
7. The IC ecosystem urgently needs a trusted stablecoin. I believe the launch of USDG, a USD stablecoin backed by gold, will change this situation. Can you explain the anchoring mechanism of USDG?
The anchoring mechanism of USDG is currently being worked on by Dr. Yulin Liu, a senior economic advisor at ChainLink, and other experts from the Swiss Federal Institute of Technology in Zurich. There is no further information available at the moment, but we expect it to be similar to systems like MakerDAO or Liquidity. Indeed, the focus of USDG is to create a strong stablecoin for the IC ecosystem.
8. In recent years, the narrative around RWA has been very hot, with many RWA protocols emerging, including numerous gold tokenization protocols such as Tether's XAUt. In comparison to similar projects, what do you think are the advantages of Gold DAO?
The surge in RWA discussions highlights the potential for blockchain to bring innovation to the real world.
Gold DAO's goal is not just to be another gold tokenization project; we are committed to providing viable, real-world solutions. A key advantage of Gold DAO is the use of the ORIGYN protocol, which is a project rooted in real-world assets (RWA) since its inception, with data directly stored on the blockchain, setting it apart from other gold tokenization protocols. Additionally, the participation of GLDGov holders in governance is crucial to ensuring the decentralization of Gold DAO.
9. The ultimate goal of Gold DAO is to launch SNS Swap. Why do you want to do this?
The main goal of launching Gold DAO SNS is to ensure decentralization, especially considering the strict regulations surrounding gold. There could be significant risks in centralized control of such an important asset. SNS is a system used for issuing governance tokens and deploying DAOs. The governance token of Gold DAO is named GLDGov.
GLDgov holders essentially become co-owners of various smart contracts of Gold DAO. They will have the right to vote on the direction of Gold DAO's development. Additionally, they will receive OGY token rewards and a share of future income. Reasonable economic incentives ensure the governance of Gold DAO.
10. Gold DAO mentioned in the whitepaper that cross-chain integration is one of its goals. What are your plans for this?
Gold DAO is working with the DFINITY Foundation, initially integrating with the Ethereum and Bitcoin networks. The purpose of cross-chain integration is to make Gold DAO accessible to everyone in Web3, not limited to a single blockchain. Gold should be universally available, and facilitating cross-chain interactions is a key step in achieving this goal.
11. What are the plans for the development of the Gold DAO ecosystem? How do you plan to attract more builders and users?
Currently, our primary goal is to develop a secure and fully functional gold tokenization ecosystem. In terms of attracting participants, there are two key groups: builders and users. Currently, the most pressing need for Gold DAO is users. To address this, Gold DAO will focus on showcasing viable products to users seeking stability and secure value storage, attracting them to purchase gold tokens, namely GLD NFT and GLDT.
12. This question may be a bit premature, but do you have any potential airdrop plans?
There are some marketing activities and contest plans aimed at actively engaging the community.
13. The development of IC has not met expectations since its mainnet launch, and the ecosystem development has somewhat stagnated. How do you view the future of the IC ecosystem? What possible changes can Gold DAO bring to the development of the IC ecosystem?
Gold DAO aims to make a significant contribution to the IC ecosystem by introducing a stablecoin backed by physical gold and a cross-chain protocol that allows users to interact with it without needing to know it is based on the IC chain.
Regarding the future of IC, I believe the blockchain world is still in the early adoption stage, and IC offers unique features that other blockchains would not prioritize: decentralized cloud. This feature is crucial because it allows anyone from anywhere in the world to store sensitive data independently of large centralized entities. In the Crypto world where power and wealth often concentrate, IC provides an important alternative.
14. As an expert in the field, what are your visions for the future of RWA?
In the context of blockchain, RWA aims to simplify and enhance our interaction with real-world assets while improving functionality and accessibility. This approach will demonstrate the practical benefits of blockchain in improving the functionality and usability of real-world assets by simplifying asset management, reducing administrative burdens, and lengthy and complex procedures. A typical example is the gold market, which is inherently complex. However, projects like Gold DAO are addressing these complexities, demonstrating the effective application of blockchain in RWA such as gold. I am very optimistic about the future development of RWA.
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Note:
The above projects and views should not be considered as investment advice. DYOR. According to the "Notice on Further Preventing and Dealing with the Risks of Speculation in Virtual Currency Trading" issued by the central bank and other departments, the content of this article is for information sharing only and does not promote or endorse any business and investment activities. Readers are strictly required to comply with local laws and regulations and not participate in any illegal financial activities.
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