Blockchain platform Elrond to tokenize precious metals

Elrond (EGLD/USD), a high-throughput blockchain platform, recently announced partnering with a fintech company Aurus, based in the UK. The partnership will allow Elrond to delve deeper into DeFi, although with a unique approach — the platform plans to work with Aurus to tokenize precious metals.

According to the company’s announcement, there are three metals that Elrond plans to focus on — gold, silver, and platinum. As a result, there will be three precious metal-backed tokens — AWG, AWS, and AWP. The tokens will be issued on Elrond’s own blockchain as ESDT tokens, each of which will be backed by 1 gram of the respective metal.

Elrond sees this move as one that will open new opportunities for people in DeFi, allowing them to engage with stablecoins of different kinds. Indeed, most of the biggest stablecoins are pegged to fiat currencies, such as the USDT, USDC, and others. While stablecoins can technically be pegged to any asset of value, such as oil (Venezuela’s Petro), or even other cryptocurrencies, such stablecoins are much rarer.

Elrond has plenty of plans for the future

Elrond further said that the new tokens will be made available on its own Maiar exchange and AMM, which it previously launched earlier this year, in April. The project also plans to use the new partnership in order to integrate Aurus tokens into its products, which would include the use of commodity-backed tokens. These tokens would be used as collateral for lending/borrowing in DeFi, and even for launching new stablecoins.

The platform’s CEO, Beniamin Mincu, believes that this will improve the traditional assets that serve as a store of value. It will boost their security, liquidity, and make them much easier to transfer, as well as own. Furthermore, Elrond expects to see some innovative and creative uses for the products within its ecosystem.

Despite the move, however, the project’s native token, EGLD, saw a 4% drop earlier today. The drop is not surprising, given that cryptos across the entire market are suffering another bearish wave, including Ethereum (ETH/USD), which surged over the weekend due to the hype regarding the incoming London hard fork implementation.

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