What is OneGram?
OneGram, a Islamic financial services and technology company, is partnering with GoldGuard, a Dubai-based online gold trading platform, to create the first “gold-backed digital currency” globally. Each OneGram coin token represents a gram of gold.
The Islamic finance sector is around 1% of global GDP and growing at nearly 20% per year.
With an estimated 1.8 billion Muslims worldwide according to a study in 2015 – holding to a quarter of the world population of around 7.5bn people – OneGram is seen as “Sharia-compliant” which helps us to keep gold in a much more secured and digital format with an ease to transfer it across borders.
And, given that the number of Muslims in the world is expected to grow by 22% in 2030, the joint venture between OneGram and GoldGuard, means “inception of crypto currency trading to the Islamic world.”
Approximately 12,400,786 OneGramCoin tokens (OGC) will be sold in OneGram’s initial coin offering (ICO) on May 21, with accounts able to be opened next week on May 8 when the gold can be purchased. At this current gold price, a house full crowd sale would raise over $554 million, which will make history as the largest cryptocurrency crowd sale.
In an interview, Mr. Ibrahim Mohammed, the CEO of OneGram said, “This is the first time something really exciting is happening in Islamic finance. It’s showing that Islamic finance stood the test of time and is entering the digital market when even conventional finance is struggling in how to enter blockchain and make money.”
He added: “With OneGram we are providing convenience for investors who encourage Islamic financial growth and the security of commodity-backed investments to benefit from fast changing technological advances in this industry.”
High Barriers to Enter Islamic Markets & Cryptocurrency
It is observed that the existing cryptocurrencies are not designed with bearing in mind Islamic sector. Despite Muslims being 25% of the global population, many Muslims face restrictions to use cryptocurrencies legally in many countries in the Islamic world.
OneGram plans to solve these issues by using blockchain technology to create a “new kind of cryptocurrency”, where one gram gold is there to back up each coin at start. After the joint venture, the team at OneGram will manage the OGC protocol while GoldGuard will be looking after the physical gold.
A small transaction fee generated will be charged for each, which will be reinvested in more gold (net of administration costs), and eventually increases the amount of gold that backs each OneGram. Therefore, each OGC increases in real value in the future.
Gold Investments & Sharia Law
In the past, gold investing has been difficult under Sharia law. While there is limited guidance for gold coins, there is no guidance at all on gold in the financial sector.
In most cases, futures contracts in trading gold is forbidden by Islam, as gold are not backed by physical gold and you end up paying or receiving interest on your transaction. The catch is most people who wants to invest in gold have no option but to purchase gold in its physical form.
In December 2016, the Sharia Gold Standard was introduced by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) which OneGram complies with.
As a result of this new standard, investors will now be able to take advantage of a growing range of gold-backed investment opportunities which complies with Sharia standards.
With a successful ICO earlier, from September 15th the main network for OGC transactions is set to launch, and listed on popular crypto exchanges by the end of September.