A Comparison of Gold ETFs and Gold-Backed Cryptocurrencies

4 min read

What is a Gold ETF? A gold exchange-traded fund (ETF) is a commodity ETF that consists of only one principal asset: gold. ETFs are similar to individual stocks and trade on exchanges in the same manner. The main aspect that complicates gold ETFs more than traditional stocks is the derivative underlying the investment. A derivative is a “contract between two or more parties whose value is based on an agreed-upon underlying financial asset.” An example of an underlying asset would be a security or commodity. Gold ETFs hold gold derivative contracts that are backed by gold. So when someone invests…...

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Igor Davidov Fascinated with all things crypto-related since finding out about it mid 2017. Was entering my second year of law school at the time of discovering crypto. My passion only grew during that time and now, post-graduation, I am transitioning to working full time in the space.