Gold-Backed Cryptocurrency Aims To Tap Stablecoin Appeal

(Bloomberg) — Bitcoin may be a distant alternative to safe havens, but CoinShares Group is betting that trading a digital gold asset linked to the token may provide investors with a sense of security.

The launch of the product, called DGLD, included $20 million of the digital metal tied to an offset of Bitcoin’s blockchain, with each token representing a 10th of a troy ounce. One ounce of gold for immediate delivery on Tuesday cost $1,483.61, or about a sixth the price of one Bitcoin. Bullion often serves investors as a hedge against instability.

“As the stable coin starts to become more popular, we’ve seen numerous attempts to create gold-backed coins,” Meltem Demirors, chief investment officer at CoinShares, which manages roughly $700 million of assets, said in an interview Monday. To capture some of that market share, the London-based company decided to “create a coin that could functionally act as a stable coin, but be backed by something physical, i.e. gold,” she…