The hype about cryptocurrencies that started in the last decade wasn’t a result of marketing alone, nor was it a result of investments and funding alone either. Instead, at the heart of cryptocurrencies, there is a revolutionary technology that powers it all: Blockchain.
Blockchain was introduced by Satoshi Nakamoto in 2008 to be the backbone of his new electronic currency named “Bitcoin”. But blockchain isn’t about cryptocurrencies alone, and its usage far exceeds this domain in a lot of other possible use cases.
By the way, don’t waste time searching for information about Satoshi. No one knows their true identity, and there are many urban legends speculating whether Satoshi is a person, a group, or something more mysterious.
What is Blockchain?
Blockchain is a revolutionary technology that has been introduced with the rise of cryptocurrencies that allows the creation of a decentralized immutable data store, which can be used for a lot of useful purposes. Think of it like a database system that can be added to, but once data is added, it can never be removed or changed.
Moreover, the blockchain system does not require a central authority or manual checking to verify or accept these operations. Instead, the entire process is decentralized, and anyone can write to the blockchain or verify its operations.
Technically speaking, blockchain is a set of data “blocks” that are connected to each other like a “chain”. Each block contains a number of cryptography-based hashes that are designed mathematically to make it impossible to alter the data of the block once it has been written.
This data could be anything; transactions in the case of cryptocurrencies, or any normal data the system designers choose. Anyone can create their own blockchain instance or use an already available one for their tasks.
Blockchain Usage at Phi Wallet
At Phi Wallet, we use blockchain technology for validation and recording gold operations done by customers. Using blockchain instead of traditional data stores for gold operations has allowed us to revolutionize the way people buy and sell gold, allowing anyone from anywhere to get access to physical gold in a digital format, what we also call digital gold, each token is backed by 1g of real gold allocated in our vault.
While the blockchain itself remains private at Phi Wallet for security reasons, its existence removes a great burden from our technical infrastructure and adds a nice set of additional features.
Benefits of Blockchain for Gold Operations
1. Security
By settling gold transactions over the blockchain, then there is no entity that can alter or remove these operations from the blockchain. The way blockchain is developed and designed simply does not allow for such types of sabotage, or otherwise, it will be instantly detected and rejected.
2. Transparency
Using blockchain allows a greater deal of transparency when needed. For example, in case of a legal request or dispute, then the blockchain can be displayed and viewed by the allowed legal parties to make sure everyone has their rights reserved.
No one will need to take anyone’s word for it, because the system is already guaranteed to function in a transparent way that records all operations and maintains all involved parties’ rights, ensuring no problems arise in edge cases.
3. Fractionality
In blockchain technology, there is a concept known as “tokens”. Tokens are digital representations of any possible object - whether physical or not - that can be divided into units and operated with. A token could reflect any quantity of a selected digital object, such as gold, silver, copper or anything else. It could reflect an intangible object such as votes, records, or anything else.
At Phi Wallet, we tokenize our gold reserves so that each token represents 1 gram of gold, enabling its ownership, buying, selling and transferring operations to be allocated and clearly recorded whenever they happen and for any user of our service.
This is the reason why people around the globe can buy whatever amounts of digital gold they find suitable for themselves from Phi Wallet; tokens are allocated and made available according to the budget the user wants to purchase with at that moment.
4. Accessibility
Blockchain is powered by an electrical system and can utilize the Internet. Users from all around the world can access it and run operations on it when needed.
The usage of blockchain and the digitalization of the gold reserves we have at Phi Wallet allows us to eliminate any middlemen in the process, and allow users to buy gold 24/7 at any time they need. It removes the hassle of having to buy digital gold and store it safely.
In the near future, we plan to enable a feature that allows users to send and share gold among themselves; which means the gold in their account - in any amount of their choosing - could be transferred to any other user they choose on Phi Wallet.
Such a feature would have been very difficult to implement had it not been for the blockchain technology. But since gold reserves are tokenized and blockchain is available already, then these “transfer” operations will be nothing more than taking these tokens - which represent physical gold - and giving them to another user.
In this way, blockchain is an extremely helpful technology to empower the digital gold industry.
5. Shariah Compliance
This is an important feature to make gold really inclusive. Phi Wallet is certified as Shariah Compliant, which means that 1.9 Muslims in the world can now buy gold through blockchain without compromising their faith.
Since all operations are immediate and instantly recorded via blockchain and can not be altered or removed, then this enhances ownership and makes the gold bought via Phi Wallet compatible with the Sharia law (Islamic law) for Muslims.
In other words, the tech is making it more inclusive for a broader range of people to easily access gold and maintain their ownership and rights.
Conclusion
Blockchain is a transformative technology with applications far beyond its association with cryptocurrencies. From enabling secure, transparent, and accessible transactions to revolutionizing industries like gold trading, its potential is vast and growing. At Phi Wallet, blockchain empowers our users to own, sell, and transfer digital gold with unparalleled security and inclusivity, ensuring compliance with global standards and diverse needs, including Shariah compliance.
As we continue to innovate, blockchain remains at the heart of our mission to make gold accessible to everyone.
