BitGold looks to take gold savings mainstream with app and global network

CALGARY – Want to buy gold as a savings alternative? Well, you guessed it, there’s an app for that.Josh Crumb, co-founder of BitGold, says he created the software that automatically links buyers to bullion dealers and storage companies because he wanted to make it easier for people to own gold as a hedge against inflation and as a store of value.“It’s just so much easier, like everything else, to do it from your mobile phone,” said Crumb.The system charges a one per cent fee to exchange cash into gold and back but storage is free. It also allows users to transfer their gold value to a prepaid credit card, so they can actually buy a cup of coffee with their gold holdings, said Crumb.“It gives the ability without having to go to coin shops and shave off some flakes of gold to buy something.”Crumb said he and co-founder Roy Sebag were inspired by the possibilities of Bitcoin, which allows global financial transactions without going through banking systems.Like Bitcoin, BitGold allows free transfers between users, including an international money-transfer option that is in the works. But the key difference, says Crumb, is that Bitcoin will never be a store of value while gold already is.“We said, let’s do everything Bitcoin is promising to do, but let’s actually be able to do it by having a real currency.”The Toronto-based company began offering its service to the public in May and had already racked up more than 168,000 global users by the end of July, with about $7 million in transactions.Crumb said the system should be popular with the fringe gold bugs who foresee the imminent collapse of the U.S. dollar and a rise in gold, but he wants to appeal to a wider base who will use it as a form of savings account.“You don’t buy gold to get rich like you’re buying Apple Stock, you buy gold to protect your savings.”Most BitGold customers are in their forties or older, said Crumb, but he is seeing younger buyers who have never bought gold before.“We are expanding the market because we’re taking so much friction out of it.”But many financial advisers disagree that gold should be considered a prudent place to store wealth.“The message of gold as a hedge against inflation is something that people sort of accepted as a given, but I think in the last 20 years it really hasn’t been true,” said Ted Rechtshaffen, president and CEO of TriDelta Financial.He said gold has had volatile swings in value in recent years, while inflation has actually stayed quite low.Rechtshaffen acknowledged that gold could be a good investment in countries where you can’t trust your currency or government, but for Canadians it doesn’t make much sense.“I’m not saying gold is a bad investment, but gold as an alternative to cash or as a hedge against inflation, I just don’t buy it.”Danielle Park, a partner and portfolio manager at Venable Park Investment Counsel Inc., has outlined her skepticism of gold on her blog.“Gold makes no sense to me as an investment. It pays nothing, it is not essential for anything in our economy and, as an analyst I have no way of assessing its fair value,” wrote Park.She says investors should be especially wary of taking gold-buying advice from those selling it.“If you are taking your buy advice from those who are paid to sell you the investment products, you are putting yourself and your capital in harm’s way.” BitGold looks to take gold savings mainstream with app and global network by Ian Bickis, The Canadian Press Posted Aug 30, 2015 8:00 am MDT Last Updated Aug 30, 2015 at 8:40 am MDT AddThis Sharing ButtonsShare to TwitterTwitterShare to FacebookFacebookShare to RedditRedditShare to 電子郵件Email

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