Executive Summary
In an era where sustainability and environmental responsibility are paramount, the NatGold™ model introduces a groundbreaking approach to gold monetization that aligns with ESG principles. This white paper delves into the NatGold tokenization model, which leverages NI 43-101 certified gold resources—Measured, Indicated, and Inferred—to digitally mine gold without the need for physical extraction. By applying conservative probability discounts to each resource category, NatGold coins ensure stable, reliable value, positioning them as an innovative financial instrument in the commodity market.
About the Author
Larry Segerstrom is a bilingual senior mining professional with more than 37 years of exploration, operations, and business experience. He is currently consultant and Director for junior mining exploration companies in North and South America. His past positions include COO of Paramount Gold and Silver Corp. where he led the team in discovering new inferred resources of 750,000 ounces of gold and 60 million ounces of silver at the San Miguel project in Mexico, now a part of Coeur’s Palmarejo Mine. As Manager of Geology of the Grasberg mining district in Indonesia for Freeport McMoRan, he played a significant role in the development of new ore reserves of 3.4 billion pounds of copper and 3.6 million ounces of silver at Freeport-McMoRan’s at Grasberg. Mr. Segerstrom is a Qualified Person under the Canadian Institute of Mining (CIM) to write NI 43-101 technical reports, considered the gold standard for certifying gold resources.
Introduction
Pioneering a significant shift from conventional gold mining, the NatGold tokenization model employs the same certified data used globally by the geological and financial sectors for mine financing decisions. This ESG-friendly digital mining approach marks a fundamental transformation in the monetization of gold as both a monetary instrument and a reliable store of wealth. It preserves the environmental integrity of mining sites and offers a sustainable alternative to the traditional impacts of the gold industry on ecosystems and communities.
The NatGold Tokenization Process
Regulatory Framework: The foundation of the NatGold tokenization model is its strict adherence to the “National Instrument 43-101 Standards of Disclosure for Mineral Projects” (NI 43-101). Administered by the Canadian Securities Administrators, this framework ensures accurate, consistent, and transparent disclosure of mining-related information, developed under the guidance of the Canadian Institute of Mining, Metallurgy and Petroleum.
Integrity and Independence
Qualified Persons (QPs), as defined by NI 43-101, are professionals with a minimum of five years of experience in mineral exploration or project evaluation. Their independence is critical, upheld through stringent ethical codes and regulatory criteria to prevent conflicts of interest. This ensures that the assessments and reports they produce meet the highest standards of reliability and objectivity.
Why Certified Gold Resources Matter
NatGold’s valuation strategy is rooted in digital mining, emphasizing the intrinsic value of gold’s existence rather than focusing on its extraction feasibility. This innovative approach only focuses on certified gold resources and not on certified gold reserves. This ESG-friendly digital mining strategy redefines gold’s role as a store of wealth, showcasing the impracticality of traditional extraction methods.
Resource Categorization and Conversion Ratios
NatGold applies the NI 43-101 standard, classifying gold resources into three categories based on geological certainty:
Measured Resources: The highest certainty, converted at 0.80 NatGold coins per ounce.
Indicated Resources: Moderate certainty, converted at 0.40 NatGold coins per ounce.
Inferred Resources: Lowest certainty, converted at 0.20 NatGold coins per ounce.
These conservative ratios ensure that each NatGold coin is backed by a verified quantity of gold, contrasting sharply with traditional mining finance which often leads to environmental degradation.
Perpetual Protection of Gold Resources
Once a mining title containing NI 43-101 certified gold resources is exchanged for NatGold coins, the underlying gold is perpetually protected. No further exploration, development, or extraction activities can occur, ensuring the gold remains undisturbed and preserving its ecological and cultural landscapes.
Global Standards and the Primacy of NI 43-101
While other standards like SAMREC and JORC exist, NI 43-101 is the gold standard for mineral project reporting. Its rigorous requirements, the credibility of its Qualified Persons, and its robust mineral resource and reserve reporting standards make NI 43-101 technical reports accepted by all major global stock exchanges, more than any other reporting standard.
Probability Discounts in Traditional vs. NatGold Models
Unlike traditional mining, which applies probability discounts based on economic extraction potentials, the NatGold model applies discounts based solely on the existence and certified status of gold resources. This approach provides a stable and less speculative basis for financial modeling, enhancing the reliability of NatGold coins as a store of value.
Conclusion
The NatGold tokenization model redefines the value of gold, focusing on preservation over extraction. This approach not only aligns with global sustainability goals but also presents a stable and responsible investment alternative. By safeguarding the physical and social environments associated with gold resources, NatGold sets a new standard for resource monetization, propelling us towards a future where gold is valued for its existence, not its extractability.
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