U.S. precious metals dealer Anthem Vault Inc. said on Wednesday it has launched the first digital currency backed by physical Gold with an aim to increase the use of bullion as an accepted form of electronic money.
Las Vegas-based Anthem said it will launch 10 million “INNCoins” backed by 100 grams (3.5 ounces) of gold, with all coins expected to be in circulation by July 2015.
Anthem Vault Chief Executive Anthem Blanchard said that Wednesday’s launch was a promotional offering and the company has plans to offer a full suite of virtual currencies backed by a larger amount of gold as well as other precious metals at the end of September.
The Field
INNCoin is a form of cryptocurrency – the most notable of which is Bitcoin (BTC), which operates on a decentralized, peer-to-peer network, meaning no government, bank or administrator regulates the currency.
The system rewards computers that solve complex mathematical problems by the occasional payoff of new bitcoins in a process known as 'bitcoin mining'.
After The Fall
The launch comes at a critical time for online currency markets after the failure of Mt. Gox, once the world’s largest bitcoin exchange, and increased regulatory scrutiny shook investor confidence in digital currency.
The market is also crowded with Anthem competing against established players including Namecoin (NMC), Litecoin (LTC), Dogecoin (Doge), Peercoin (PPC) and Mastercoin (MSC).