Buying Gold using Proof of Product

Kalib Loy • Feb 12, 2023

Case Study: How to buy gold using proof of product

A small investment company was looking for ways to invest in gold, a valuable commodity with a long history of being a secure investment option. After conducting research, the company came across Bluhe Shire, a private trust known for their expertise in gold investment. The company reached out to Bluhe Shire to learn about their methods of buying gold without spending any capital.


Bluhe Shire informed the company about the process of monetizing gold using a POP (Proof of Product) or MT608 message. The process involves obtaining a POP or MT608 message from a reputable source, such as a bank, gold dealer, or gold exchange, and submitting it to a financial institution for verification.


The small investment company followed this process and obtained a POP or MT608 message from a reputable source, which they then submitted to a financial institution. The financial institution verified the authenticity and ownership of the gold and determined its value, which allowed the small investment company to sell the gold and receive payment for it in the form of cash, a check, or a wire transfer.


Thanks to the guidance from Bluhe Shire, the small investment company was able to complete their transaction and invest in gold without spending any capital. This provided them with a valuable opportunity to diversify their portfolio and benefit from the potential appreciation of gold in the future.


Overall Performance

The cost of the gold in this scenario is $51,000,000. If the gold is 12% under market value, this means that the market value of the gold is 12% higher than the cost of $51,000,000. To calculate the market value of the gold, we can use the formula:


Market value = Cost / (1 - (Discount rate / 100))


In this case, the discount rate is 12, so the calculation would be:


Market value = $51,000,000 / (1 - (12 / 100)) = $57,800,000


So the market value of the gold is $57,800,000, which is 12% higher than the cost of $51,000,000.

The profit from this transaction would be the difference between the market value of the gold and the cost, which in this case is:


Profit = Market value - Cost = $57,800,000 - $51,000,000 = $6,800,000


However, there is also a cost of 2.5% in total fees associated with this transaction, which needs to be taken into account. The fees would be calculated as follows:


Fees = Cost * (Fee rate / 100) = $51,000,000 * (2.5 / 100) = $1,275,000


So the net profit from this transaction, taking into account the fees, would be:


Net profit = Profit - Fees = $6,800,000 - $1,275,000 = $5,525,000



In conclusion, if the cost of the gold is $51,000,000 and it is 12% under market value with a 2.5% cost in total fees, the profit from the transaction would be $5,525,000.


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