Physical gold VS Digital Gold

What is Digital Gold?

Digital gold is a new and convenient way of owning vaulted gold. Instead of having to shop for physical gold bars, you may go online, enter your mode of payment, and buy a sum of vaulted gold. Ownership is “digital” in that you could manage it online; however, you do have possession of real gold bullion; it’s simply saved in a vault somewhere a ways away. Some virtual gold companies are increasingly turning to blockchain technology to track the ownership of vaulted gold and offer an extra layer of safety. Blockchain technology can create a ledger system that tracks possession publicly and permits an open market for digital gold. 

What Is Vaulted Gold?

Before we get into digital gold, first it helps to understand what the term “vaulted gold” means. Vaulted gold is bullion that in no way leaves the vault. Individuals, funds, and agencies can spend money on it, but it stays properly where it is. In Canada, that basically means it stays in the possession of the Royal Canadian Mint or one of the primary banks, all of which keep bullion.Physical gold VS Digital Gold

  1. Investment cost:

Digital Gold: You only pay to buy the metal when you invest in digital gold through various online portals. There are no costs for you. In any case, investing in digital gold avoids the sunk cost of making charges. Your investment’s total cost is reduced as a result of this.

Physical gold: There is no way to avoid making charges when you purchase physical gold.   Even when you buy gold coins, bullets, or biscuits, the maker adds a nominal making charge, which usually ranges between 8% and 16%. When you invest in gold through intricate jewelry pieces, the making charges usually start at 8% and can go much higher depending on the work required. All this significantly increases your total investment cost. 

  1. Liquidity

Digital Gold: In major economies, digital gold is readily available with unmatched liquidity. You can continue trading it in real time through any digital platform you choose.

Physical gold: Disposing of physical gold typically requires some time due to its physical nature. Instead of this, it is true that physical gold is also liquid. But in certain countries, it is somehow difficult to get cash for physical gold.

  1. Transparency

Digital Gold: Purchasing digital gold is a well-regulated and rigorously documented process. There is no scope for adulteration.

Physical gold:  While some brands hallmark all of their coins and jewelry before selling it, there are plenty of unbranded jewelers who might sell you gold that has been altered.

How to buy digital gold online:

There are several digital gold providers in Canada, such as Goldmoney, BitGold, and Vaulted. You can sign up for an account on their websites and then buy and sell digital gold through their platforms. These providers typically charge a fee for their services, so be sure to review their fee structures before signing up.

How to buy physical gold online:

Physical gold is available in various forms, such as coins, bars, and rounds. Each type has its own advantages and disadvantages. Therefore, it depends on the choice of the investor. Look for a reputable dealer who sells physical gold. Some well-known dealers in Canada include Kitco, Au Bullion, and Instant Gold Refining.

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