The Tiberius Coin grants the holder direct ownership of a special basket of metals, chosen for their unique industrial applications to future technology and commodity growth sectors. The Tiberius Coin is comprised of both a digital (crypto) and physical (metal) component, where the link between the two is maintained by Tiberius, but decentralized through the use of independent service providers. The holder of a token can take delivery of the underlying metal, which supports the minimum price of the token and grants full transparency. The integrity of our network is maintained by rational economic principals, which are a consequence of using competing service providers, warehouses, and auditors.
Problem and Solution
1. The problem with cryptocurrency markets.
Solution: Cryptocurrencies may have no intrinsic value so asset-backed coins make sense but the main problem is that cryptocurriences just too volatile and highly correlated. It doesn’t matter how many different cryptocurrencies a person owns, when prices fall it is like a person holds just one in portfolio. Diversification is hard to find. The reason why all coins plummet together (correlation and volatility) is that there is simply not enough crypto-to-fiat liquidity during a market panic. People can trade Bitcoin, Ethereum, and a few other cryptocurrencies against only a handful of fiat currencies. When this happens, the panic selling is the same as being in a crowd where everyone is pushing to exit through the same door. This panic is called “illiquidity”. When a person exchanges the Tiberius Coin for fiat currency a person is really going through metal markets as a hidden middle step. Metal markets are large and liquid enough to soak up any volatility in cryptocurrency markets, providing a stable price floor solving the illiquidity problem but without capping any of the upside.
Benefits of the Tiberius Coin
1. More “stable”.
2. More “secure”.
The Tiberius Coin, in essence, boils down to having less price risk than other cryptocurrencies. Although metal-backed cryptocurrency has multiple applications and users of varying background, the Tiberius Coin begins and ends with being safer. Safety means both stability and security.
Classification of the Tiberius Coin
The Tiberius Coin is a security in the form of an uncertificated security. It is not a derivative, because it is not a financial instrument that derives its value from an underlying. The Tiberius Coin is a means of transfer of the underlying commodity itself. Tiberius Coin is an asset token. At least for now the Tiberius Coin does however not have any characteristics as payment token. This might however change as time progresses and/or the necessary regulatory framework mutates.