Digital gold currencies are finally entering the mainstream of investor attention, primarily because of the fascination with gold and silver coins as investments in their own right. These tough economic times of 2008 and continuing, is focusing a growing number of on what economists call "hard money" (precious metals) as a means of wealth protection. The fact that the united states dollar is over a downward path means alternative currencies in precious metals are receiving a lot more attention.
So, if you opt to purchase a DGC
, are you more likely to lose your money? This is an excellent question because owning gold by doing this is entirely dependent on the financial health with the company involved. More importantly, the integrity of the people involved with the company has become the secret weapon to success. Previously being associated with a digital gold industry from your start as an investor, here is what I've found.
Gold currencies certainly are a relatively recent form of investing, the increase of which completely paralleling the development and continuing development of the internet. E-gold is considered the "grandaddy" of these companies, however only being around since 1996 shows how rapidly developing the industry is. The corporation was hugely well-liked by the online high yield investment program (HYIP) people, which ultimately caused it's decline. This was because of some rather dubious characters involved with HYIP's that caught the interest of the US authorities regarding money laundering and tax evasion. Domiciled within the offshore island of Nevis, E-gold was effectively run from your Usa from the well respected Douglas Jackson, a professional pioneer of the profession. Unfortunately the lack of "Know Your Customer" controls around the owners of these accounts resulted in the united states authorities clamping recorded on the organization pending tighter account compliance.
E-gold holds but with a restricted use. You will never spend e-gold right now as uncertainty with this business is hindering its progress. Interestingly, anything you have in e-gold will have increased in value due to the rapid increase in the gold price. Remember, with one of these accounts you have gold rather than dollars. The company is rapidly trying to get all their account holders to upgrade their accounts to think true ownership details. This involves uploading proof of residence and evidence of identity documents to the company. Considering this can be in response to US government requests, the reluctance from many of the previously privacy seeking owners of these accounts to comply is obvious. This has resulted in significant downtime of the e-gold website, which further erodes confidence of it's users. As a penalty if you don't upgrade your account, you will be charged a higher holding fee. Interestingly, the truth that the gold backing your account is safe and secure in Switzerland or another offshore centres will not appear to be a problem.
An appealing point is when E-gold had not been located in the USA, it could probably be thriving and become at the forefront of the digital gold industry still. For Douglas Jackson, the founder, being arraigned and the threat of the criminal conviction for "money laundering" in america was enough for him to fold for the pressure and comply.
Safety inside a digital gold currency account depends upon several factors. Being perfectly located at the US does not always mean that it will survive and prosper. A very similar account to E-gold called C-gold situated in Malaysia is apparently thriving, with great auditing from the gold owned obvious online. The integrity of it's owners remains seen, because it is very new, but they're on a good start.