Daily Gold Market Report

Decentralized Blockchains vs. Permissioned Networks:
The Cybersecurity Debate in Asset Tokenization

(USAGOLD – 3/15/2024) Gold prices are lower this morning after manufacturing activity in the New York region collapsed this month. Gold is trading at $2160.16, down $2.03. Silver is trading at $25.15, up 33 cents. Regulators are moving towards allowing banks to tokenize financial assets on permissioned networks rather than decentralized, permissionless blockchains, raising concerns about cybersecurity vulnerabilities. The tokenization process involves creating digital representations of real-world assets on a blockchain, and while this trend is gaining momentum, the preference for permissioned networks could lead to significant risks. Permissioned networks, controlled by a few entities, are more susceptible to hacking compared to the robust security of decentralized blockchains, which are maintained by thousands of validators and have a strong track record of resisting cyber attacks. The push for tokenization on permissioned networks by regulators and financial institutions could potentially set the stage for unprecedented cybersecurity breaches in the financial system.

USAGOLD Comment: Owning physical offline assets (gold and silver) is essential for maintaining financial security and protecting one’s wealth from potential cyber threats and vulnerabilities in digital systems.