OKC company creates online market for precious metals

Published: Tuesday, November 13, 2018 By: Brian Brus

A new online service launching in Oklahoma is expected to bring holders of cryptocurrencies back to a more tangible investment base.

Apmex Inc. Chief Executive Ken Lewis announced his company is partnering with Canadian asset manager Sprott Inc. to launch OneGold.com, the first online marketplace for buying, selling and redeeming what executives referred to as “digital metals.”

Sprott is publicly traded on the Toronto Stock Exchange under the code SII; Apmex is privately held.

Apmex touts itself as the world’s largest online retailer of precious metals with more than $10 billion in sales since the company’s founding in 1999. The company doesn’t just store raw metal; its gold, silver and platinum stores are also crafted into commemorative items, and it resells collectible currency coins from around the world. And much of that material is stored in downtown Oklahoma City in massive vaults in the former Federal Reserve Building.

“We have about $100 million in inventory sitting in these vaults,” Lewis said. “Think of Apmex like Amazon.com for precious metals. We have the inventory here, merchants managing the on-site assortment and setting prices. It’s just like any other internet retailer; we just happen to deal in $1 billion per year in gold and silver.”

OneGold.com is an adaptation of blockchain technology to the precious metals market. The term blockchain is a catchall for distributed online systems that provide a high level of transaction transparency via shared community ledger while protecting users’ identities. Blockchains are the foundation of cryptocurrencies such as bitcoin, ethereum and crypto, which are created online and have only as much transactional value as users collectively agree.

In Sprott’s quarterly earnings report, also released this week, CEO Peter Grosskopf said Sprott is committed to being at the forefront of technological innovation in the sector and has made two investments in fintech companies using blockchain technology to digitize gold. In short, OneGold.com users will not only be able to keep their assets locked in digital form, but can also to redeem their shares as physical metals for home delivery.

“With products like crypto out there, and people migrating to their phones to do banking, and using products like Betterment.com to do their investments, we felt that we needed to have a digital presence more than just a pick-and-pack environment,” Lewis said.

OneGold.com clients’ interests will be held in a vault in Canada, fully insured and protected, Lewis said. But unlike cryptocurrencies, that interest can be cashed out for precious metal.

Lewis said that sense of consumer confidence harkens back the concept of a gold standard on which many countries’ currencies were based years ago. The recent advent of cryptocurrencies eschews such a standard entirely – they’re not even recognized by the Internal Revenue Service as true currencies.

“You’re able to take a metal position, knowing that the physical metal is always there to back it,” Lewis said of the new service. “It’s very much like an ETF (exchange-traded fund), but the major differences are that many of the ETFs … cannot completely state that the metal is always there.”

Read the story at JournalRecord.com

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