A Digital Monetary System Backed by Physical Gold and Silver
Kinesis Money offers a digital monetary system fully backed by physical gold and silver. It allows individuals and businesses to trade, save, spend, and transfer these metals using straightforward digital tools built for regular use.
The platform issues two native tokens: KAU, which represents one gram of physical gold, and KAG, which stands for one ounce of silver. The actual bullion is stored in professionally managed, third-party vaults. Transfers, ownership records, and spending all take place on the blockchain.
Precious metals have served as money for most of recorded history. Back in 1830 the British economist Nassau William Senior noted that “the portableness of the precious metals and the universality of the demand for them render the whole commercial world one country, in which bullion is the money.” Instead of viewing bullion primarily as an investment to be stored away, Kinesis treats it as a circulating medium. Unlike other gold-backed tokens, such as Pax Gold and Tether Gold, which function primarily as investment vehicles, KAU and KAG are designed to revive a monetary tradition that stretches back thousands of years.
Why People Are Looking Beyond Fiat Currencies: The Quest for Sound Money
When one considers the early history of the United States, it is striking how deeply some of the most influential Founding Fathers distrusted unbacked paper currency and warned of its consequences. Thomas Jefferson, for example, warned, “Paper is poverty, it is only the ghost of money, and not money itself.” George Washington expressed concern about states “falling into very foolish and wicked plans of emitting paper money.” James Madison described paper money as unjust and unconstitutional, noting that it “affects the rights of property as much as taking away equal value in land.”
There is an obvious historical irony here. The very men who warned against paper currency now adorn the paper money whose expansion they would have decried. As one congressional testimony put it: “Placing images of some of our most revered Founding Fathers on various bills gives bogus money the patina of legitimacy by implying that it had the imprimatur and endorsement of the Founders, when in fact they condemned paper money.”
In his 1966 essay Gold and Economic Freedom, long before becoming the 13th Chairman of the Federal Reserve, Alan Greenspan offered a striking explanation for the hostility toward the gold standard: “In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. … The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves. This is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard.”
We can debate the real intentions of those whom Greenspan called welfare statists, while critics of the gold standard argue that modern economies require monetary flexibility and that strict asset backing can constrain policymakers during economic crises. What is hardly deniable, however, is the vulnerability of fiat currencies to devaluation—particularly when authorities resort to stimulus measures.
The effects are familiar: retirees living on fixed incomes find that their savings buy less each year; conservative savers are forced to take on more investment risk than they otherwise would simply to keep pace with inflation; and unsophisticated investors, as well as those without or with only limited access to financial instruments—according to an FDIC survey, 18% of U.S. households are currently either unbanked or underbanked—experience a steady erosion of their wealth, often without even realizing it.
It is understandable, then, that many have started looking for alternatives. They are seeking a medium of exchange that resists debasement through arbitrary creation. This was, for example, what originally made Bitcoin so attractive before it became a purely speculative asset.
Democratizing Access to precious metals
Investing in physical precious metals has traditionally come with several practical hurdles: secure storage, transportation, insurance, authenticity checks, and often high minimum purchase amounts. In some countries a retail bullion market exists and feels quite normal, but in many others it is virtually absent, leaving ordinary individuals with few realistic options.
Even where dealers are available, the process remains far more involved than opening a savings account or buying an ETF. Investors face a range of decisions: coins or bars, small denominations or larger bars, appropriate insurance, methods of verifying authenticity when buying and selling, competitive buy and sell spreads… and perhaps the most pressing one: where to store their bullion safely.
The solution suggested by the well-known “if you don’t hold it, you don’t own it” principle, which some bullion stackers treat as an unquestionable rule, often reflects the perspective of investors living in stable, affluent countries, where secure home storage is a realistic option. It overlooks, however, the circumstances of millions of people elsewhere, for whom security concerns, inadequate housing, political instability, or weak legal protections make storing precious metals at home neither practical nor desirable. It also overlooks that the principle is difficult to reconcile with institutional ownership: a pension fund may own allocated bullion, but no one would expect it to store that bullion itself.
Kinesis lowers many of these barriers by making ownership of allocated gold and silver accessible through nothing more than a smartphone and an internet connection. On the Kinesis Exchange, users can trade precious metals against major fiat and crypto currencies at prices close to the wholesale market, resulting in low buy and sell spreads.
The ease and cost-efficiency of trading and spending precious metals within the Kinesis Monetary System are especially valuable for lower-income users. Unlike traditional bullion investments—where metals remain relatively illiquid, effectively locked away as dead money—Kinesis users can access their purchasing power whenever needed.
What kinesis offers with regard to precious metals parallels, in my view, the way mobile banking expanded financial access in emerging markets by bypassing traditional barriers. Just as millions gained access to financial services through mobile phones without ever visiting a bank branch—consider how mobile money platforms like M-Pesa transformed financial access in East Africa by allowing users to store and transfer value through basic mobile phones—so too can individuals around the world now hold and use precious metals without ever visiting a vault or bullion dealer. The democratisation of sound money may prove as transformative as the democratisation of banking itself.
Gold Standard 2.0: Sound Money for the Digital Age
Kinesis’ project goes beyond making bullion easier to own: users can transfer funds instantly between wallets; the Kinesis Card functions much like a conventional payment card, converting the value of gold and silver holdings into local currency in real time at the point of sale; merchants can accept payments in gold and silver through Kinesis Pay. In each case, the underlying goal is the same: to restore precious metals to their historical function as money rather than treating them solely as investment assets.
History suggests that skepticism toward new payment technologies is hardly unusual. When credit cards first appeared, many people questioned whether anyone would trust a piece of plastic instead of cash. Similar doubts accompanied the arrival of online banking. It was common to hear people say they would never manage their finances over the internet, preferring instead to continue going to their local bank branch whenever they needed to make a transfer.
Today, both technologies have become routine.
In many respects, Kinesis represents what might be called Gold Standard 2.0: not a return to the nineteenth century, but an attempt to combine the monetary discipline traditionally associated with gold with the speed and convenience of digital payments—an idea that is no longer purely theoretical, as demonstrated by recent sound-money legislation in states such as Texas, Utah, and Florida, where the legal groundwork has been laid for electronic payment systems based on gold and silver.
An important distinction separates Gold Standard 2.0 from the first one: participation is voluntary. People choose whether to hold and transact in precious metals rather than having a single monetary system imposed upon them. That addresses one of the longstanding criticisms of historical gold standards, namely that they required every participant to operate under the same monetary framework regardless of differing economic conditions.
To me, this voluntary approach and the monetary competition that follows from it are among the model’s strongest features; it replaces compulsion with choice: individuals who believe their purchasing power is better preserved through precious metals can opt into such a system, while those who prefer conventional fiat currencies remain free to use them.
Why the Allocated Bullion Exchange Matters
What are the origins of Kinesis? Kinesis builds on the foundation of the Allocated Bullion Exchange (ABX), an institutional electronic exchange for physical precious metals, founded in 2011 and fully launched in 2016, that facilitates trading and provides storage for fully allocated bullion.
For Kinesis users, one of the most relevant aspects is ABX’s established partnerships with vault networks and logistics providers such as Malca-Amit, Armaguard, and Loomis International. These relationships give the Kinesis system access to a professional, insured, and globally distributed bullion infrastructure which includes recording ownership of allocated bullion, reconciling metal holdings, and arranging independent audits of vaulted metal: the regular audits of the metals backing KAU and KAG are made possible and more efficient because the bullion is held within an infrastructure that already supports professional custody and auditing.
In summary, Kinesis benefits from its relationship with ABX by leveraging an existing institutional bullion infrastructure—including custody, vaulting, reconciliation, and audit procedures—rather than having to develop these systems independently.
Can Gold and Silver Become Money Again in a Digital Economy?
Critics maintain that gold-backed systems cannot compete with established fiat networks, particularly given the widespread acceptance of national currencies and the dominance of the US dollar in cross-border transactions.
Within the precious metals community, there is broad agreement in favour of returning to some version of a gold standard—essentially, anchoring money once again to gold rather than relying on fiat currencies. Yet this preference is often accompanied by a deep-seated distrust of anything digital, a caution shaped in large part by the Bitcoin phenomenon. One frequently encounters a nostalgic vision that seeks to revive payment systems from a century ago, when the original gold standard was in place, and apply them directly to today’s far more complex economy.
Within cryptocurrency circles, the opposite attitude often prevails. There, the physical nature of gold is sometimes seen as a limitation, suggesting its monetary role belongs to history.
So, there we have it: the one-million-dollar question. Can gold and silver resume their monetary role in an economy built on digital payments?
If sound money interests you, if you’re looking to diversify your savings, if you already invest in precious metals, or if you run a business open to accepting gold and silver as payment, I hope this website proves useful.
Should you choose to open a Kinesis account, you will have access to several integrated tools like the Kinesis Exchange for trading precious metals against major fiat and cryptocurrencies; the Kinesis Card for everyday spending; Metalback, a cashback program for online purchases that rewards users in precious metals instead of cash; Kinesis Pay for merchants who accept or wish to receive payments in allocated, audited bullion; and the Kinesis Yield System, which provides rewards based on platform participation.
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