BitGold Inc. (
TSX: V.XAU,
Stock Forum), an internet platform for acquiring, holding, and making payments in gold, has soared in value since the stock began trading on the TSX Venture Exchange last week.
Listed at 90 cents on May 13, 2015, the stock built on its recent gains by gaining another 40% to trade a $5.79 on Tuesday, leaving BitGold with a market cap of $217.9 million, based on 36.6 million shares outstanding.
Backed by U.S. fund manager George Soros,
Sprott Ltd. (
TSX: T.SII,
Stock Forum), and other financiers, BitGold is a Canadian company with officers in Toronto, and Milan, Italy.
It was founded by Roy Sebag, a 29 year-old former hedge fund manager, and Josh Crumb , who is 35 and has a background in mining. They came up with the idea after the 2008 financial crisis.
Bitgold operates a platform that enables users to purchase gold using various electronic payment methods. It also allows users to store gold and pay for goods and services around the world using gold as the currency.
Once fully operational, the platform is intended to provide various transactional capabilities, including instant cross-border payments, merchant invoicing and processing for gold, debit card spending of gold at traditional points of sale, conversions to a customer’s external digital wallet or bank, and physical gold redemptions.
The company said it plans to operate a network of ATMs, allowing users to open accounts or deposit local currency in exchange for vaulted gold, which will be accessible for digital transactions.
All of the physical gold acquired through the platform is owned by the customer, stored in vaults administered by The Brinks Company, acting through Brink’s Global Vault Services International Inc., which insures gold through third party insurance providers.
“It is a complicated (structure). But for users – and this is the main thing – it’s just Paypay with gold,’’ Crumb told The Financial Post newspaper. “It’s a nice clean interface.’’