Malaysia-based HelloGold, which blends gold trading with blockchain technologies, has closed a Series A round at a post-money valuation of $12 million. A Malaysian vehicle called Dani Sdn. Bhd is among the investors. Additionally, it is raising funds through an ongoing initial coin offer (ICO).
HelloGold’s live mobile app in Malaysia lets customers buy and sell physical investment grade gold for a minimum price of RM1, as well as permits them to use the gold as collateral for affordable loans and to transfer their gold to their friends and family at no cost.
On 28 August, it commenced a token sale through the HelloGold Foundation Token Sale which has raised $4 million to date with a target fundraise of $8 million, according to its CEO and Founder, Robin Lee. Lee was previously the CFO of the World Gold Council, the market development organisation for the gold industry.
He told this portal: “Strategically, the creation of tokens for us as a business makes a lot of sense because HelloGold is effectively a closed platform. We go country by country. So in Malaysia, we find partners and we have to make sure that our product falls within the regulatory framework of the country onshore and then we have to boots on the ground to distribute the product and promote it to the mass market.”
“For each country, it takes six months to a year to launch and then two years to stabilise. We plan to accelerate that as much as we can with our fundraise but its a function of money and more importantly human capital.”
Lee says for 2018 he plans to expand to Thailand and China and plans to concentrate on emerging markets in Asia where he plans to promote financial inclusion products for mass-market consumers.
He adds, “With the token sale, we can create gold-backed tokens that are effectively issuing a blockchain-enabled digital form of what we’re doing to the whole world and then enable the underserved and unbanked to access gold as savings and as a form of collateral for loans immediately rather than country by country. So from a business perspective, it sits very nicely alongside our traditional business model.”
The firm is aiming to grow its customer base to 10 million individuals. It has also partnered with Aeon Credit Services (M) Berhard, the personal financing arm of the largest retailer in Asia – Aeon Co. Ltd.
According to Lee, the digital gold-backed tokens are meant to enable the firm to enhance financial inclusion. The HelloGold Foundation (HGF) has the objectives of accelerating the mass market use blockchain technologies and to expand the availability of products that help the underserved and unbanked in emerging markets.
The token sale proceeds will be used to finalise the development of the Gold Backed Tokens (GBTs) using Ethereum ERC20 tokens. GBTs will be backed by 1g of 99.99 per cent investment grade gold, securely vaulted with HelloGold’s nominated vaulting provider in Singapore.
The sale proceeds will also be used to support the development of an “ethereum smart contract” based gold financial products and HelloGold’s geographic expansion.