A little about what we enable.
http://www.vaultoro.com is the first true bitcoin gold trading platform. Built as a real global marketplace, anyone can trade in and out of allocated physical gold, secured in the client's name as their property, in top-tier vaults within Switzerland.
I got stung by MtGox and wanted to build the most transparent exchange in the industry. I give talks at bitcoin conferences about transparency and how we can have transparent exchanges and still protect user privacy.
Vaultoro prides itself on being one of the most transparent exchanges in the world, utilising the blockchain to show full proof of 100% gold and bitcoin reserves.
I got into bitcoin back when you could still mine with CPU but I got into it to escape fiat that's another reason we built a true bitcoin gold exchange to anyone including the 2.5 billion unbanked can use bitcoin as a currency and gold as a store of value instead of using fiat.
Anyone can start trading down to 4 cents worth of bitcoin and because gold is a physical good there is no need to upload KYC documents for less than 5K USD worth of bitcoin per day.
Our goal is to enable anyone to hedge the bitcoin volatility with a real physical asset that is owned by the user and not by a bank.
We have just passed the 2Million dollar trading volume after launching in February this year AMA
I feel that a privacy based coin is what is needed, this is not to do illegal things but is needed for legitimate business needs, a lot of businesses that I talk to say they don't want to currently use bitcoin because they don't want competitors to know company secrets like how much they pay staff, who their supplier is and so on. Saying that I think the sidechains that are being worked on are going to deliver solutions in this space. I think there will always be competitors to the bitcoin blockchain but sidechains will enable people to test out concepts with the vast security and power of the bitcoin blockchain backing it.Which digital currency (litecoin,dogecoin, peercoin etc) do you think will be the biggest competitor to bitcoin in 5 years
Yes, I agree about the real time trading, every other company offering gold for bitcoin only offer brokerage services were they are the only counterparty. The problem with that is if you buy a lot of gold from those companies and they decide to make the buyback price really high then you're forced to pay that to get your money out. On Vaultoro, if we as the market maker decide to make our buy back price higher then someone else will jump in front of us in the order book to offer a closer price to spot.The real time trading is key. Have you considered futures, leveraged trading or other derivatives?
I believe all markets can be accessible through Bitcoin, legal wise what is the biggest hurdle to exploring new types of commodities, currencies or even keeping the gold exchange running?
Leveraged trading is planned in the development cycle. It will be a great way for people to earn interest on their savings (both bitcoin and gold) by lending it out to short sellers if they wish to do so.
But also, I really like that bitcoin has a price discovery mechanism based on a commodity and not just debt based fiat nonsense. It moves us further away from a fiat paradigm.
The legal threat to our business is not that big. Buying and selling gold is a very well defined and understood industry. We will definitely stay abreast of the bitcoin regulations that are being discussed in different countries around the world. Companies like e-gold got shut down because they were creating their own currency and allowing individuals to send each other gold. Governments don't like privately minted currencies, that's the beauty of bitcoin, they have to allow it because they ae not able to shut down a decentralised protocol. We do not issue a currency that people can send each other, if someone wants to use their gold then they instantly convert it to bitcoin and then use that as the currency.
We will be opening order books for silver and also creating partnerships with vaulting firms in Hongkong and other geographical areas around the world. This will enable people to arbitrage gold in different countries but also move value in seconds if a geographical region becomes politically unstable.
The gold price is based on market forces yes, but traders mostly act logically and so price discovery on Vaultoro will generally follow global gold spot price.If Gold price is based purely on market discovery, with Bitcoin to Gold, is it difficult to maintain liquidity to prevent slippage in times of great volatility? How do you provide gold liquidity to the books in a fair manner if you do so?
When trading USD or CNY, those currencies, have had fairly good performance as of late, so when trading it appears BTC is only fluctuating against that currency. Do you think it becomes more difficult trading because you're dealing with volatility on both sides?
With Bitcoin and Gold, you will have to look at both sides of the trade to decide on a price that works for you. Gold is fairly stable when compared with other commodities like oil and when traded with bitcoin is generally the stable part of the pair.
USD or CNY might seem stable because it' a person's home currency but that does not make it stable. It depends to what you compare it to.
We want to implement more feature so users can compare prices more easily, like having the option of showing all prices in USD, CNY, EUO but settling in bitcoin.
Re liquidity, we have a market maker in place who provides liquidity and have strong partnerships with one of Europe's largest gold suppliers and vaulting firms so liquidity is not a problem. Since we are a marketplace, once entered, anyone can provide liquidity and offer gold for a price they feel is fair.
When we act as a market maker we offer gold as close to world spot price as possible to make it attractive for everyone.
Thanks man, Originally we looked into people being able to do that but we decided against it for now because we need to make sure that all customers gold is investment grade at least 99.95% pure. To make sure of that we source good delivery bars direct from the mine to the vault. Otherwise, we would have to add the cost of testing and smelting into the price which would be expensive. Saying that, we have had this request a lot so might look at other solutions to make it happen.Very cool service, especially the fact that you can request actual delivery at any time.
Can customers deposit physical gold? i.e. Can I mail you 2 Gold Eagles and get credited 2Oz's in my account?
This is something we are currently working on. It will be fantastic for clients to be able to spend their gold holdings anywhere standard credit cards are accepted. Stay tunedDo you offer any gold backed cards for customers?
Plenty of trading going on. Remember that when people trade fiat the money is legally owned by the bank so if something happens to the exchange or to the bank the money can disappear (MtGox) This was a huge inspiration for me. I wanted to build an exchange where the counter value is owned by the customer as their legal property. This way the value is fully secure and insured.Are you seeing many arbitrage attempts with BTC price volatility... or are customers mainly HODLing?
Yes Silver will be next but we want to fill out the gold order book first. We can also look at platinum and palladium but will have to see if the community wants it first.Are there any other commodities coming on in the future?
We currently accept most popular altcoins through our partnership with shapeshift but all pairs will most likely stay in bitcoin for the foreseeable future)Any other coins to be used in the future?
No I think the bitcoin protocol will gain privacy at a protocol level through sidechains and at an application level through technologies like JoinMarket and Coinjoin.You mentioned "dark" coins... do you believe they will be necessary with things like JoinMarket plus CoinJoin? I feel privacy will be built into Bitcoin one way or another.
NOTE: I have started answering other questions within the forum thread because this first post was getting too long skip to page two to read on