When so many crypto investors have gotten burned recently, why should investors have confidence in Jinbi Token’s ICO? “Because they’re buying gold,” says Andre Rafnsson, co-founder of Jinbi Token, as he profiles this unique blockchain investment opportunity. “Jinbi” means “gold coin” in Mandarin. Unlike some other crypto-currencies, Jinbi is a gold-backed crypto that can easily and immediately be transferred anonymously between peers, with no middle man or broker involved. Jinbi Token holders enjoy the benefits of both gold and crypto-currencies.
Andre Rafnsson is responsible for Business Development and Investor Relations at Jinbi Token and has over 20 years management experience in the international pharmaceutical, medical device, specialty chemicals, and recently the biotech sector. Since 2010, Andre has been working in private equity as an investor and director in various life-science start-ups. He holds an equity stake as well as supervisory board positions in those companies. Andre has for the past 10 years been a personal investor in physical gold and silver.
BEGIN TRANSCRIPT (edited for readability and clarity)
Bill: Welcome back, ladies and gentlemen. Thanks for tuning into another Mining Stock Education episode. Today I’ll be profiling a unique investment opportunity that links blockchain technology with physical gold and also the actual mining of gold. Joining me on the show today is Andre Rafnsson, the co-founder of Jinbi Token. Jinbi means gold coin in Mandarin. So Andre, thanks for coming on the program.
Andre: Thank you very much, Will. I’ve been looking forward for this interview.
Bill: Andre, you are the co-founder of a very unique investment asset that we’ll be sharing with listeners today. But before we delve fully into that, I’d like for you to give listeners a little bit about your background, how you came to invest and be a developer in the blockchain space, how you became interested in gold investing, and anything else regarding your background as both a businessperson and an investor.
Andre: Thank you very much. Well, I actually have an aviation background. I was a pilot in the Royal Danish Air Force and flew some private jets for a while until 1996, got my degree in business administration, went into the medical field, and I’ve basically worked for some of the larger pharmaceutical/medical device businesses, ran subsidiaries in eastern Europe. Did that for almost 20 years, exited in 2009, started my own private equity firm with four partners, where we invested incubator companies again within life sciences.
One of my partners was a precious metals expert, got me automatically drawn into that market. I always liked gold and silver, not just as a shiny metal, but always considered them as a safe haven and a vehicle, despite the fact that I never invested in them until we came into 2009 and ’10, post-crisis. I saw a lot of people losing a lot of money over the 2008 and ’09 period. And after surviving it myself, I promised myself not to put my family and my partners in a situation where we lose it all.
So I thought precious metals would be the good hedge. I started investing privately on retail level. Later, we got some money together and made some investments in mines. So we invested in mines in Russia and Africa, and since then, we’ve been expanding our operations. In terms of crypto space, I personally got interested in that about a year and a half, two years ago. I didn’t do anything about it until last January or February, where I bought my first bitcoins and ethereums. My first investment in an ICO company was Pillar.
To make a long story short, I ended up at the launch seminar with Pillar and I’ve been working with them since.
Bill: So that’s your background regarding gold. You’ve actually been an investor in gold mining and crypto. Jinbi Token, of which your co-founder brings those three things together. Can you give us an overview of Jinbi Token and its unique characteristics?
Andre: Yes. The blockchain space and the crypto space…Everybody is aware that we’re still kind of in beta mode. So we are leaving the old world and getting into the new world, as we call it in the blockchain space, and precious metals is a natural part of that. My partner and I saw very quickly that blockchain gives us an incredible opportunity to get this space into transparent stage.
The problem is we have today that a lot of precious metals, especially gold and silver, is papered in contracts, and there are currently more contracts out there than gold available. It’s a manipulative system. It is controlled by the big trading houses and banks. It’s officially been suppressed, and we don’t like it. So the miners are not happy with this. Blockchain gives us an opportunity, via a smart contract, to get the gold registered through the whole value chain until it sits in a vault, and the Token holders, which is the Jinbi Token holders, is really a blockchain certificate that gives the investor access to the physical gold. So they can call in the physical gold whenever they want. Just deliver your tokens. We will add them up, and we’ll send the gold to you. You’ll be able to monitor the gold 24/7, 365 days a year.
So it’s really a peer-to-peer acquisition system within the precious metals space, in full transparency, and without all the third-party fees. And we believe that the precious metals in general is gonna go that way.
Bill: So you’re one of the pioneers of this. One company that I’m sure many listeners are familiar with is Goldmoney, where you can use government-issued fiat currency, whether that’s US dollars, Canadian dollars, or another currency, and you can load that into your Goldmoney account, and then you can be issued grams or ounces of gold. You can exchange, within your Goldmoney account, back and forth between gold grams and whatever fiat currency you want. It’s spendable via MasterCard, I believe. So could you help listeners understand more, especially those that have not followed the crypto space? Could you talk about the differences and similarities, if any, between Jinbi Token and Goldmoney?
Andre: It’s very similar, to be honest. The only thing that we are trying to cut out is the added fees to the spot price. So basically once it gets out of the mine, once it gets valued, confirmed, smelted, refined, and put in the vault, the participants in acquiring a Jinbi Token, hence physical gold, are getting it for the spot price. And when they want to call the gold in, we send it for the spot price plus shipping costs.
Now, if the investors do not want to sit with the gold, they can convert it into other cryptocurrency or get cash for it. So it’s kind of similar. It gives you flexibility to move in and out of fiat, into cryptos or physical gold, except the only difference we, at this stage, have not entertained is issuing a credit card. We believe that the Pillar wallet that we are partnered with will give, and it’s just around the corner, will give an infrastructure in the wallet to be able to move freely from fiat to cryptos and back.
So we’re not gonna issue a card. I think that’s archaic. I think this is the old world. We’re just gonna wait for a few months, and then the wallet will be available and do exactly the same things out of your phone.
Bill: So with GoldMoney, if I took approximately $1300 US, put it into a GoldMoney account, I would own approximately 1 ounce of gold. Could the same be said of a Jinbi Token? If I took $1300 US, bought the equivalent of Jinbi Tokens, would I own 1 ounce of gold? Could you clarify that?
Andre: Yes, you would. That’s exactly what’s happening.
Bill: Okay. And then if I take physical possession of the gold, does that Jinbi Token then disappear because it was counter-balanced or linked to the gold that I now took possession of?
Andre: No, it’s basically like a certificate. You give us the Jinbi Token back. We will give you your gold, and we’ll hold it in storage.
Bill: Okay. Could you rightfully call the Jinbi Token a gold-backed crypto? Is that the best definition? Or what would be the most accurate description of Jinbi’s relationship to gold?
Andre: That is exactly the definition, a gold-backed crypto or asset.
Bill: Okay.
Andre: Asset-backed crypto. Yeah.
Bill: So you already have in place an off-take agreement with a gold producer. Are you able to talk about the details of that or what company that is?
Andre: Yes. We have a partnership with International Precious Metals, and they have off-take agreement with five miners. They are in business. They are producing. They are selling gold. They have tied themselves into a…It’s not disclosed, but with audit…It’s a tremendous amount of gold over the next five years. We’re just taking a little bit of that, and that will be reserved for us and for the Jinbi Token holders. The vaults will be in Cyprus and Switzerland. The refinery is in Cyprus, and the Jinbi Token holder will at some point be able to decide if they want it in Switzerland or Cyprus.
Bill: So that’s similar to Goldmoney in the sense that, I believe, with Goldmoney you can choose where you want your gold vaulted.
Andre: That is correct.
Bill: Physical gold bullion investors, as you know being one yourself, do so oftentimes or primarily to remove counter-party risk, to protect their wealth via physical gold bullion. The saying, as you know, is, “If you don’t hold it, you don’t own it.” In what ways does the Jinbi Token minimize counter-party risk for the investor?
Andre: By the way, I just want to be very upfront here. I agree. I hold my physical gold. I have some physical. I have some silver because it’s very bulky, in an independent, outside-the-banking-system vault in Switzerland. But besides that, I agree. If you don’t hold it, you don’t own it. Now, the next best thing I would say is crypto and the blockchain. The smart contracts that, through AI, that control the whole logistics and control the delivery, is basically doing it on our behalf and on the investor’s behalf, which means that we cannot interfere, and we cannot manipulate with it.
So I would say that if you live in a…I wouldn’t even say exotic territory. I would say in the land of the free and the home of the brave, which is United States of America. It’s one of the few countries that actually did confiscate indirected gold in 1933 and ’34. If we’re entering some turbulent times, which we believe we are, there is absolutely no guarantee that the state is not gonna do that again, especially if they go back to the gold-backed currency. The blockchain and the crypto space protects the investor from that. You will have it in Switzerland or in Cypress. You will have your deed to your gold on the blockchain, and physical confiscation is basically not possible.
So I would say the third…The counter-party risk is not there unless we have a force majeure situation like wars and things that are completely out of our control, but then everybody will be in trouble. So I would say that as an alternative for not holding it yourself, with the liability that carries, I think the blockchain system and the technology behind it is the next best thing.
Bill: Since Jinbi’s link to gold, do you expect less price volatility compared to non-gold-linked cryptos?
Andre: Of course. Gold has a 4000-year history. An ounce of gold today buys pretty much the same assets as an ounce of gold during the Roman times. It is the most consistent over times. It is the best hedge that you can have of any asset class, documented for thousands of years. Civilizations…The currencies were built on gold, like Greek, Egyptian, the Hebrew, the Roman. So we’re pretty confident that it’s a safe space.
Now, you’re probably not gonna have the 400% and 800% spikes like you have in other cryptos, because it’s linked to gold, but then again, it’s not gonna disappear like some of the cryptos. Like 47% of all ICOs last year don’t even exist anymore. So we consider ourselves being a conservative safe haven for crypto gold investors.
Bill: Physical gold bullion investors often complain about the manipulation of the gold price through paper futures contract, and you actually kind of referenced that already. The banks can flood the market with supply in the form of these futures contract. As you know, this drives down the spot price of gold. How is Jinbi Token connected, if at all, to how the spot price of gold is set?
Andre: Well, unfortunately we’re not large enough to affect the spot price. So what we offer is an alternative solution for transparency. So we’re hoping that the industry will follow suit and do this and basically pull themselves out of the paper contracts and out of the common system. I think this is not gonna happen overnight, but this is the first step. Once we succeed in doing that and majority of the miners start pushing their gold towards the blockchain structure, and if we coup it together with a system like Veritaseum: total transparency, peer-to-peer transactions, and the Pillar wallet and the systems that are soon gonna be available, we will basically, fairly quickly, within a few years, take the manipulation out of the gold market. Then the real price will be set without the big banks having a direct effect of it. That’s really what I see coming, but let’s see if that really happens. But overall, unfortunately, Jinbi does not have an effect on the spot price. We follow the market.
Bill: And when you buy your gold from the mining partner that you have the off-take agreement with, you buy that at Comex spot or the London fix price? How is that price set?
Andre: This is really where our business case is internally solid. We buy it for the manufacturing, for production price. Since we are shareholders and partners in International Precious Metals, we get it for cost of goods, I’ll say, and that’s spread. Between that manufacturing price and the spot price, this is where Jinbi makes profit.
Bill: So then Jinbi’s upside would more be linked to gold and an increasing gold price than it would be to the speculative value that many other cryptos have. Is that correct?
Andre: That is correct. Plus, the Jinbi Token price will increase with an increased volume that we’re holding in our vaults, which is exactly what we’re doing. We’re not gonna sell it. We’re gonna hold it. As the stock and the volume increases, the Jinbi Token’s pricing will increase.
Bill: Andre, please share your thoughts regarding the Federal Reserve and the current global fiat monetary systems, and then contrast that if you could with what are the qualities of an honest, equitable, monetary system? And how does Jinbi display some of those qualities?
Andre: Well, William, you’re pushing the right buttons right there. Federal Reserve is a criminal system that was drawn in to United States in 1913. I am 100% anarcho-capitalist. I do believe that the fraud will stop at some point. The fiat system, the US dollar has lost 99.2% of its value since 1913. The average purchasing power of a household in the United States has decreased drastically over 25 years. I believe that…I’m working and I’m pushing. I’m doing mine to challenge that system. The only way we get an honest system is if our currency is linked to a real asset, real value. Call it gold. Call it oil. Silver. Whatever assets your countries represent, link it to that. If you don’t do that, you give a government’s carte blanche to print unlimited amount of money and basically dilute your pension funds and your purchasing power. So that’s my five cents on that. Federal Reserve is 100% non-auditable criminal system.
Bill: Jinbi is in the process of an ICO. Can you talk about that? Who can participate in this ICO? And why are there some restrictions on who can participate?
Andre: Yes, unfortunately the anarchistic ICO times from last year have stopped. SSC, FCA, and larger regulatory institutions monitoring the space, they do issue subpoenas also if there is something that breaches the security laws. So we’re kind of trying to behave, the good we can. We’re doing KYC (“know your customer”) and AML (“anti-money laundering”). We are complying. We have an information memorandum. We have done everything that we can do in order to meet the current laws. Unfortunately Americans cannot participate, and Chinese cannot. That’s just the national laws that prevent them from that. The only way to participate in Jinbi, which it is definitely possible for Americans and Chinese, if they contact us directly, and they meet sophisticated investor and high net worth individuals requirements in the given countries. And in that way, they can participate directly with us if they sign off on the basic high net worth forms. But participating like everybody else, logging on the site and contributing ether, unfortunately, is not possible for Americans and the Chinese citizens or residents.
Bill: What about Canadians?
Andre: Well, Canadians…We just had an opinion last week. It’s a gray zone really. Since our token is issued out of Belarus, according to the laws where we operate, we can. Our last legal opinion was that Canadians could participate if they comply with the KYC and AML, but that could be challenged, and we know this.
Bill: In the past year, many crypto investors, as you’ve already referenced, have been burned through ICOs. Can you explain why investors can be more confident in the Jinbi ICO?
Andre: Because they’re buying gold. Gold is not gonna disappear, and it will be 100% documented, and we will have a CCTV camera in place in the first quarter of 2019 in the vaults. So the Jinbi Token holders can log on 24 hours a day and see the gold stored in the vaults. That’s where the risk is out of it. That very simple. It’s not a future to be software launched. It’s not dream projects that are connected to advanced AI that might or might not materialized. You’re basically buying gold, and you’re buying gold for the spot price.
Bill: And then that’s gonna be third-party audited frequently?
Andre: It would be audited through the whole value chain, from the mine to the vault, and twice a year. Jinbi Token participants will be part of the biannual dividend proceedings, and before we do that, there’s a full audit.
Bill: So dividends. Are there gonna be dividends? And how will those be paid?
Andre: They will be paid in cryptocurrencies, either in ether, bitcoin, or gold.
Bill: Okay. If investors want to get in contact with you and the company, how would they do that?
Andre: Well, they can do that directly to me, andre@jinbitoken.io, and we also have an info address on the website. Welcome right to that address. We have a good team that monitors that all day long. But if somebody, especially if they’re high net worth and they want to participate in more larger amounts, and they can meet the sophisticated investor form requirements, they can email me directly. So it’s andre@jinbitoken.io.
Bill: And where can one purchase Jinbi Tokens right now?
Andre: Right now, you can purchase them on our website.
Bill: And is there anything else you’d like to share with listeners regarding Jinbi Token and this project?
Andre: Well, we’re very excited. This is not…We’re not gonna stop here. We already have a family office in Dubai that have signed up for the soft floor. So our soft cap is already covered. So the risk is taken out of that. They have committed to $15 million. Our soft cap is $8 million. So we’re looking forward to complete this process, get International Precious Metals going, and start storing gold and start communicating with our gold community.
Bill: Well, listeners, this is a very intriguing investment proposition, crypto-linked gold, even gold production. To learn more, you can go to jinbitoken.io. And as Andre said, you can reach him at andre@jinbitoken.io. Andre, I appreciate you joining me for the program today.
Andre: Thank you very much, William. I appreciate it. Thanks.
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