# Lifestyles & Discussion > Personal Prosperity >  Kinesis

## Paul799

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## timosman

Who are the major stakeholders in this blockchain?

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## dannno

So can you trade your digital coins for gold? 

Who holds the title to all the gold? 

Do they have the total value of the gold held insured in case it is stolen? What if it is stolen by the govt?

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## Paul799

I don't know timo
Probably, since kinesis is born out of the Allocated Bullion Exchange (https://abx.com), as you can read somewhere on their homepage, I guess they are Kinesis major stakeholders, but it is just guessing

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## Paul799

danno,
a) yes, you can ask for delivery of the precious metals represented by your kinesis coins
b) the owners of the coins
c1) insured, yes.
c2) I don't know of any specific insurance against governmental stealing


Please note, I'm trying to answer your questions the best I can, but I'm neither a kinesis representative nor a kinesis expert

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## Paul799

As I said, Kinesis was born out of the Allocated Bullion Exchange.
Kinesis and ABX share basically the same management.
The ABX is an institutional marketplace set up in 2011 for the trade of physical precious metals. Through the ABX, physical precious metals participants are able trade, deliver or store physical precious metal in 7 locations ('trading hubs') around the world: Zurich, London, NY, Singapore, Hong Kong, Dubai and Sydney.

It is the ABX which is responsible for quality, storage and audits of the precious metals represented by the Kinesis coins.
You can find their "Quality Assurance Framework", with, among others, a list of their Good Delivery Refiners, here: https://www.abx.com/d/QualityAssuranceFramework.pdf
In this document you'll find also the reference framework regulating inspections and audits.

Finally, ABX stores the bullion in an allocated way, "with individual holdings allocated through a Holding Identification Number (HIN) system. Each HIN, which can be used to identify a sub-account of a Member or a Private Client ... holds direct full legal title to all bullion purchased."
https://abx.com/technology-services/storage-logistics/

All this is of paramount importance because the whole Kinesis system depends on the confidence that the metals are indeed there backing the Kinesis currencies

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## Paul799

> Who are the major stakeholders in this blockchain?


I went to the ABX website and in the section Membership I found that ABX differentiates between: 
a) Full Members (e.g. Large Wholesale Bullion Brokers/Dealers, Large Financial Brokers/Dealers, Banks, Mining Producers, Refiners)

b) Associate Members (e.g. Stockbrokers, Wealth managers, Accountancy firms, Insurance brokers)

c) Proprietary Trading Members (e.g. Proprietary Trading Firms, Managed/Mutual Funds, Sovereign Funds, Hedge Funds, Exchange Traded Funds (ETFs), Investment Corporations, Institutional Superannuation/Pension Funds, Institutional Bullion Traders, Central Banks)

https://abx.com/membership/proprietary-trading-members/

Probably among Kinesis major stakeholders are some of the current ABX Members

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## Paul799

As I said, I don't know who the major stakeholder are, this kind of information is not public, but I guess among Kinesis major stakeholder is the Coughlin family, represented by Kinesis CEO (son) and CFO (father)

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## timosman

> Here you can find Kinesis Executive, Operations, Development and Advisory Team 
> https://kinesiscoins.com/kinesis-team/
> 
> As I said, I don't know who the major stakeholder are, this kind of information is not public, but I guess among Kinesis major stakeholder is the Coughlin family, represented by Kinesis CEO (son) and CFO (father)


CEO and CFO are related?

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## Paul799

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## Paul799

> CEO and CFO are related?


Yes timo, more or less in the same way in which Ron and Rand are related

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## kpitcher

> Yes timo, more or less in the same way in which Ron and Rand are related


It's an ERC20 coin running on Ethereum? If so this is then limited to about 10 transactions a second. Also after cryptokitties brought the entire ETH network to a crawl and raised the the gas price of ETH up to over $18 for awhile it makes it questionable that this can be used as a functioning currency for everyday usage.

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## Paul799

> It's an ERC20 coin running on Ethereum? If so this is then limited to about 10 transactions a second. Also after cryptokitties brought the entire ETH network to a crawl and raised the the gas price of ETH up to over $18 for awhile it makes it questionable that this can be used as a functioning currency for everyday usage.


Good observation 

"Following a number of prototypes and proof of concept builds, the Kinesis team determined that the most effective and fit-for-purpose selection for a blockchain network for the kinesis currency suite was to use the Stellar network forked to form a bespoke blockchain network.
There was one defining objective that needed to be met with this choice, and this is the ability for Kinesis currencies to function as the high velocity, globally used currencies that form the basis for the Monetary System that Kinesis is pioneering. 
Stellar met these primary needs in a number of ways, both technical and algorithmic, but at the core of the decision lies 3 overarching reasons.

1. The speed of the Stellar network:
For a currency platform to support the high turnaround of coins needed for it to function effectively and at the velocity projected for Kinesis suite of currencies, the speed of the blockchain network is a critical factor. The speed of networks is typically described in the number of transactions that the blockchain network can process per second.

In this regard there have been a number of closely regulated tests performed on a number of blockchain networks. The outcomes of these give a good idea of the comparative average estimated speeds of the networks under load. 
The results of these tests place Stellar at the forefront of network speed, outstripping competitive networks not just marginally but by orders of magnitude.

In an interview with the blockchain-focused podcast Epicenter, Stellar founder Jed McCaleb suggested ~4000 transaction per second was within the capabilities of the Stellar network.
Following a number of experiments with stellar networks on various scaled hardware, the outcome of estimated speeds was between 3000 and 4000 transactions per second. At this stage this remains an estimate but with higher speeds anticipated.

Compare these numbers to those obtained through experiments of competitor networks:
· Bitcoin’s 3.3 to 7 transactions per second
· Ethereum’s average of 15 transactions per second
· VISA’s 1,736 average transactions per second at current volumes and 24,000 transactions per second actual capacity

These figures will make it clear why Stellar was the top choice for the Kinesis blockchain technology and the ability for the fork of this network to cater to the high velocity of a fully fledged currency.

https://medium.com/@kinesis/why-the-...r-9ca099ffaa53

I won't pretend to understand what I just copied & pasted

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## Paul799

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## Zippyjuan

How much gold do they own to back up their currency?  Where is it stored?  They sound more like a multi-level marketing pyramid scheme where you get money by getting more people to sign up.

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## Paul799

@zippy,
"How much gold do they own to back up their currency?"
At the moment zilk, I guess.
Precious metals will be acquired and stored progressively as K-coins get minted. That’s what the relation K-coins:PM=1:1 means.
As long as there are no K-coins, there are no PM either.
As I said, the ICO is planned for March 1, 2019.

That said, it is possible that Kinesis will start storing PM in preparation for the ICO. Maybe they have already started storing, I don’t know.
It is also possible that they don’t need to store anything: Kinesis, through the ABX, has partnered with large Wholesale Bullion Brokers/Dealers, Mining Producers, Refiners…, e.g. Finemetal Asia Ltd.
https://abx.com/2017/11/01/allocated...e-trading-hub/
These companies could act as liquidity providers, meaning they will deliver the metals as these are needed to back up the K-coins while the latter get minted. 
I’m just speculating

One last remark about the way you formulated your question, just to avoid misunderstandings.
I can remember the discussion about the PM backed ETF’s like SLV etc., their legal framework is so complicated that it’s not clear who ultimately the owner of the bars is.
Kinesis won’t own the metals backing up the K-coins.
The owner of the metals are the owner of the K-coins.
When you are spending your K-coins to buy yourself a creamy cappuccino, your are spending yours, not Kinesis gold.

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## Paul799

@ Zippy,
"Where is it stored?"
The metals are deposited in the vaults of ABX partners. ABX doesn’t own vaults, as far as I know (I could be wrong)

https://www.abx.com/d/QualityAssuranceFramework.pdf

In this document points 11 and 12 are of particular importance.
11 (Audit and Inspection) guarantees that the bars are there;
12 (Approved Refiners) guarantees the quality of the bars.
The refiners where ABX/Kinesis sources the metals from are listed in the LMBA Good Delivery Lists. 
They are refiners tested and approved by the LMBA. 
The LMBA (London Metals Bullion Association) is worldwide the most important institution as far as precious metals physical trade is concerned, because London until recently was the most important trading hub for PM physical trade (now Shanghai).

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## Zippyjuan

> @Zippy,
> "How much gold do they own to back up their currency?"
> At the moment zilk, I guess.
> Precious metals will be acquired and stored progressively as K-coins get minted. That’s what the relation K-coins:PM=1:1 means.
> As long as there are no K-coins, there are no PM either.
> As I said, the ICO is planned for March 1, 2019.
> 
> That said, it is possible that Kinesis will start storing PM in preparation for the ICO. Maybe they have already started storing, I don’t know.
> It is also possible that they don’t need to store anything: Kinesis, through the ABX, has partnered with large Wholesale Bullion Brokers/Dealers, Mining Producers, Refiners…, e.g. Finemetal Asia Ltd.
> ...


So their tokens have no gold to back them.  I won't be able to  exchange my tokens for gold with them since they don't have any gold on hand to do so. The dollar was once gold backed because the government had gold you could exchange your paper dollars for. Not really a metal backed currency. 




> a crypto that is based 1:1* with gold and silver deposits*


Yet they don't seem to have any metal deposits?  Or is the customer expected to buy gold and deposit it with them?  If so, why would I give them my gold and silver so I can use bitcoins?

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## Zippyjuan

https://www.investopedia.com/news/80...-scams-report/




> *80% of ICOs Are Scams: Report*
> 
> A recent study, based on publicly available information and sources, claims that nearly 80 percent of the initial coin offerings (ICO) are scams, and only a meager 8 percent of the floated ICOs manage to reach the trading stage on the various cryptocurrency exchanges.
> 
> The New York-based Satis Group LLC, a premier ICO advisory company which also works as a digital asset focused investment bank, conducted the study based on the publicly available sources.
> 
> Study of ICOs
> The study was performed by picking the ICOs that had a minimum market cap of $50M and were expected to go into active trading. These ICOs were then categorized into six different groups, namely, Scam, Failed, Gone Dead, Dwindling, Promising, and Successful.
> 
> ...


I would stay away.

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## Zippyjuan

https://www.zdnet.com/article/here-a...raudulent-ico/




> *These are the warning signs of a fraudulent ICO*
> 
> <snip>
> 
> It might sound odd, but if an ICO website is spotless and looks extremely professional, this may indicate a scam.
> 
> Often, fraudsters will spend a small fortune on a professional-looking website and marketing materials such as a white paper, but this money is spent purely to promote trust in would-be investors.





> If a company website, whitepaper, or project descriptions are also full of nothing more than* fluff, buzzwords, and portray a lack of substance, this is a clear warning sign that all may not be as it seems*.





> In addition, you should be aware that some fraudsters *may open their own forum accounts and run social media campaigns in order to promote discussion, increase the exposure of a fake ICO, and make a project appear legitimate*.



and from their website:




> Kinesis Cayman is a registered company in the* Cayman Islands*. Registered address: C/O Stuarts Corporate Services , 36A Dr. Roy’s Drive, Grand Cayman, Cayman Islands, KY1-1104 Company No: 338455 
> 
> The information on this site is *not directed at residents of the United States* and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.


https://kinesis.money/en/referrals/

Their directors are also the same directors as ABX- their "metals source".  https://abx.com/about/leadership/

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## Paul799

> So their tokens have no gold to back them. 
>  I won't be able to  exchange my tokens for gold with them since they don't have any gold on hand to do so. 
> Yet they don't seem to have any metal deposits?


I repeat: "Precious metals will be acquired and stored progressively as K-coins get minted."
The public minting is planned to start on March 1, 2019.
You asked how much metal they have deposited right now.
Right now there are no k-coins.

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## Paul799

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## Paul799

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## Paul799

A comment on last monday R. Paul's blog article Trump is Right, the Fed is Crazy

He further explained that the world may one day see a monetary system based on a mixture of precious metals and cryptocurrencies, each posing certain advantages that account for the other’s disadvantages, saying that:
“It’s conceivable that cryptocurrencies, using blockchain technology, and a gold standard could exist together, rather than posing an either-or choice. Different currencies may be used for certain transactions for efficiency reasons…A combination of gold and crypto will prove to be a lot more achievable than getting people to adapt to a totally new concept of money.”
In 2013, someone created a cryptocurrency called RonPaulCoin to pay tribute to his Libertarian ideals that are often seen as being embodied by decentralized cryptocurrencies.

https://www.newsbtc.com/2018/10/31/r...cizing-us-fed/



This is a interview with Kinesis CEO T. Coughlin auf Russia Today.
The host is Bart Chilton, for 8 years one of the 5 directors of the U.S. Commodity Futures Trading Commission. 
The CFTC is the independent agency of the US government that regulates futures and option markets.

https://www.youtube.com/watch?v=-o7OxgMeht0

… and here an article about Kinesis on zerohedge

https://www.zerohedge.com/news/2018-...ability-crypto

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## Zippyjuan

Sounds like multi-level marketing.  https://www.seospark.co.uk/velocity-...y-or-big-scam/




> If you decide to ignore all the warning signs and join Velocity Token anyways, you’ll be met with an opportunity in which you’re asked to invest real money into VTN points.
> 
> These points range in price from 50 cents all the way up to $1.50 per point, and after you get a few of them, you’ll need to lend them back to Velocity Token’s owners.
> 
> Doing this will allow you to earn on a daily ROI that’s offered, and when doing so, you have four main tiers to choose from.
> 
> They include:
> 
> Members earn the ROI + 0.1% daily bonus after investing $100 to $1000
> ...

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## Paul799

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## Paul799

> CEO and CFO are related?


Not only Kinesis CEO and CFO are related.
I was researching DigixDao today, another major project in the gold backed cryptocurrencies space.
Chairman (picture: old guy): Teo Hye Chng
Founder & CEO (picture: young guy): Kai C. Chng
I don't know

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## Paul799

About DigixDao
I like it
In general, I like it being located in Singapore, which is a prime location for a cryptocurrency & gold based business. It benefits from a favourable regulatory environment, a relatively stable political environment (very important if you are holding physical gold) and excellent physical gold security standards.

What I like in particular are the guarantees that the bullion is actually there. This is the most important feature for someone who buys gold and let it store by a third party.
_Digix does this through their proprietary Proof of Provenance (PoP) protocol.
DigixDAO uses a Proof of Asset (PoA) concept to assist in distribution of DGX tokens. Asset Cards are created and certified by the custody hierarchy digital signatures. The Asset Cards consist of information on:* Timestamp of card creation,* Stock-Keeping unit of the gold bar, Bar Serial number, Purchase Receipt, Audit Documentation,* Depository Receipt, and due* Storage fees.
By investing, users buy bullion from the LBMA (London Bullion Metals Association) refineries. 
Digix includes third-party auditing from Bureau Veritas_.
All these features are uncommon among cryptos that state to be gold backed, which is understandable of course, implying a lot of organization.

Another feature that I like is the fact that DGX holders will be allowed to convert their cryptocurrency into bullion: _Investors can also redeem 100 DGX tokens for physical gold (100 grams) via mail or in person._
This helps in making DGX a real stablecoin, because it ensures that the value of a DGX will be tied to the value of a gram of gold. If not, speculation would trade DGX for gold, or the other way round, and gain on the premium/discount.

_DigixDAO digitizes your ownership of actual gold.
_This is exactly what a gold backed crypto should be.
I have the feeling that many gold based cryptos are nothing more than cryptos whose price is tied to the gold price.

By the way, doing my research on Digix I somehow understood what blockchain can offer to gold investors: _Digix takes advantage of the Distributed Ledgers immutability, auditability, and transparency, applying all these benefits to the precious physical asset of gold._ 
Keywords: Immutability, auditability, and transparency.



Another project that I like is GoldMoney.
His founder and chairman, James Turk, is a known and esteemed person within the precious metals community.

Goldmoney holds around 2 billion dollars in assets (bullion) and is traded on the Toronto Stock Exchange.
They dont use blockchain, so they dont offer a gold based cryptocurrency, but through their debit card they pursue the same goal of Digix, namely to build a system where you can use the gold you invested in for your everyday transactions.


http://www.goldscape.net/gold-blog/gold-backed-cryptocurrency/
Here youll find a comprehensive list of gold-backed crypto-projects, with a short, occasionally interesting description.
Im sure that some of them are worth to be looked at.

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## Paul799

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## kfarnan

Any point of control will fail.  These ICO's will fail because they aren't organic.
Looks like another bitconnect scam using pm's to back a scam coin.

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## timosman

> Any point of control will fail.  These ICO's will fail because they aren't organic.
> Looks like another bitconnect scam using pm's to back a scam coin.


Listen to the pitch

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## Paul799

Thanks Timosman

4 Jun 2019 - The Blockchain Commission for Sustainable Development is hosting its second annual Blockchain for Impact Global Summit at the United Nations.
The host, S. Fernandez de Cordova, co-founder of the UN Commission, is also a member of kinesis advisory board. Kinesis Ceo talks at 30 and 50

http://webtv.un.org/watch/part-2-blo...7223001/?term=

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## kfarnan

looks like a banker created scam to control.

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## timosman

Ponzi schemes are supposedly illegal.

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## Paul799

Here is a comprehensive list of points to check out while pondering about buying a gold-backed stablecoin
*

Due Diligence on Gold-Backed Stablecoins*

1. Can the cryptocurrency be converted into physical gold on demand? How easy is the process?

2. Does the company disclose how it stores the gold?

3. Who is storing the gold that backs the cryptocurrency? Is that company trustworthy?

4. Is the gold insured?

5. Does the company have a well-known and reputable auditor? If the company is not audited, then it can easily issue more tokens than gold, thereby creating fractional reserves.

6. What happens if the company goes bankrupt? Is it a limited liability company that could leave investors empty-handed?

7. What blockchain are the gold tokens built on? Is that blockchain secure?

8. Do you know how to store the private key to the wallet that controls the gold tokens? What happens if you lose the key? What happens if the key is stolen?

9. Gold-backed cryptocurrencies are similar to ETFs, which may make them subject to securities laws in Europe and the US. Is the company selling the cryptocurrency regulated? Does it store the gold in a country that has approved their token?

10. Where can the gold-backed token be traded? Gold ETFs are traded on exchanges, but there are currently no cryptocurrency exchanges that are licensed to trade tokenized ETFs.

11. How much liquidity does the gold-backed cryptocurrency have? Can you really close a position in case of a liquidity trap? The largest gold-backed cryptocurrency, Digix Gold Token, has a small daily trading volume of USD 243,000 over the past year, and USD 27,000 over the past month.

12. What is the total expense ratio for the tokenized shares of the gold fund? The most famous gold ETF, SPDR Gold Shares, has a management expense ratio (total fund costs / total fund assets) of only 0.40%.

13. What is the business model of the coin? How do the people who created the coin make money? If there is not a clear way that they are profiting, then be suspicious of indirect costs or high risk.

https://ingoldwetrust.report/wp-cont...on-english.pdf

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## kfarnan

whenever a currency is pegged to another asset, it will be problematic for many reasons.

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## Paul799

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## Paul799

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## Paul799

Gold and silber becoming money again, 
the revival of the Gold Standard starting among the unbanked and the underbanked population.
What a surprise

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## Paul799

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## Paul799

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## timosman

> As you can see, up until today, in the pre-ICO phase, 62 kg of gold and 11 tons of silver have been minted.


It is amazing what kind of stuff I can pull out of my ass!

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## Paul799

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## Paul799

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