So the first thing to mention is that Goldchip Investments is a legit gold mining company that is already mining gold in Zimbabwe. The company was awarded by the Zimbabwe Investment Authority as a runner up in the mining sector at the 2016 Investor Awards. This is of course important to mention because the cryptocurrency space is full of a lot of get rich quick schemes and accompanying con theatrics.
Second thing to mention is that I am not an investment nor financial nor technology expert. I am not an expert on anything period. This is important to mention because you need to make your own decisions about these things and consider your own advisors. Be careful though because cryptocurrencies are a new thing and hence ‘expert advisors’ may not be expert advisors at all.
With that out of the way, let me tell you about the Goldchip Mining Asset (GMA).
Simply put the GMA is a digital asset backed by the most trusted physical asset: gold. GMA is a cryptocurrency token just like bitcoin. This token will be issued soon by the mining company, Goldchip Investments.
Who are these guys?
Goldchip Investments have a gold mine and claims in the gold rich vicinity of Chakari (close to Chegutu). They have been mining the precious metal since 2014.
So why are they doing an ICO?
Just in case you are embarrassed to ask: ICO stands for Initial Coin Offering. This is how new cryptocurrencies come to life. This is quite similar to how a business gets to list on the stock exchange through an Initial Public Offering (IPO). As with an IPO, the cryptocurrency is first sold to larger investors before it can be acquired by the general public.
Goldchip are doing an ICO so they can raise funds to expand their operations and increase their current gold mining capacity. Generally ICO’s make it easier to raise funds than alternate routes for example listing.
Why would a person buy this GMA token?
Buying the token means you’re kind of investing in gold indirectly. Holders of the token will get a 5% royalty every quarter from the Goldchip Investments profits for that respective quarter.
What can we compare this to?
The best comparison for this token in the non crypto world is a redeemable preference share.
I’m glad you asked: Reddemable preference shares are shares that you buy to finance a company and in return the company will give an agreed portion of their profits at agreed intervals (yearly, quarterly…) as long as you hold these shares. The company reserves the right to buy back these shares from you in the future.
This is very similar to what the GMA token affords you. Goldchip also reserves the right to buy back the tokens at the market value within 8 years of the ICO.
What currency will they pay the royalty in?
The royalty will be paid out in Ether (the Ethereum cryptocurrency). Etherhas the second highest market capitalisation in the world after bitcoin. It is currently the second most popular token after bitcoin.
This is good for investors
Paying out in ether is good for investors especially external investors because this allows them to access proceeds from their investment much easier and to transfer that money outside Zimbabwe. We all know that moving money is not so easy in Zimbabwe right now and the last thing you want is to receive your money into a local bank account.
This is good for the government
No fiat currency whether it’s the bond note or the US dollar will leave the Zimbabwean market. Goldchip are currently selling their gold output to Fidelity Printers and they promise to continue doing so. Obviously because this is the law.
Investors get their money in digital currency and thus there is no remittance of money at least money as our government understand it outside the country.
When can you buy the GMA token?
The public ICO will start early June. Right now the token is being sold privately mainly to large investors.
This could be confusing…
I know this could be a little too much to process if you are not too conversant with cryptocurrencies and the blockchain in general. I don’t expect this to be the only time we talk about Goldchip Investments and their coming cryptocurrency so hang in there…