USG-Eligible Gold Collateral Standard
GG-USG-01 — USG-Eligible Gold Collateral Standard
Version: 1.0
Status: Ratified (Draft pending Council vote)
Effective Date: Upon Council Adoption
Applies To: USG (US Gold) issuance, backing, and redemption
1. Purpose
This standard defines the minimum physical gold requirements for assets eligible to back USG (US Gold), the flagship fungible gold token of the Global Gold Protocol.
Its purpose is to ensure that:
USG is fully fungible in practice, not merely in theory
Every unit of USG is redeemable into equivalent physical gold
Redemption outcomes are predictable, institutional-grade, and economically fair
The protocol maintains long-term trust, liquidity, and regulatory survivability
This standard governs collateral eligibility only.
It does not restrict which gold assets may exist or trade elsewhere in the ecosystem.
2. Core Principle
USG must be backed exclusively by physical gold that is interchangeable at redemption.
Mathematical ounce equivalence alone is insufficient.
Collateral must be economically, operationally, and institutionally fungible at exit.
Accordingly:
Only gold bars that meet strict institutional delivery standards may back USG.
Interchangeability refers to deliverability and market acceptance at redemption, not uniformity of bar weight or form factor.
3. USG-Eligible Gold Requirements
To be eligible to mint or back USG, a gold bar must satisfy all requirements below.
3.1 Purity Requirement (Non-Negotiable)
Minimum purity: ≥ 0.995 fine gold
Bars with purity below 0.995 are not eligible, regardless of weight or valuation method
Rationale:
Mixed-purity collateral introduces non-uniform redemption outcomes, exit friction, and implicit discounts — incompatible with a fungible monetary instrument.
3.2 Bar Format & Weight
USG-eligible gold collateral must conform to recognized institutional delivery standards that ensure global interchangeability at redemption.
Approved bar formats are limited to:
LBMA Good Delivery gold bars (approximately 400 troy ounces, within LBMA tolerances)
1 kilogram gold bars compliant with LBMA standards
100 troy ounce gold bars deliverable under COMEX specifications
400 troy ounce institutional cast bars from Council-approved refiners, provided they are deliverable into established bullion markets and do not carry persistent form-factor premiums
No other bar formats are eligible to collateralize USG until the GGC votes to add them to the approved list.
Rationale:
Interchangeability at redemption is determined by institutional deliverability
and market acceptance, not by uniform bar weight. These formats collectively
represent the globally accepted settlement units of the physical gold market.
3.3 Refinery Standards
Eligible bars must be produced by:
LBMA Good Delivery List refiners, or
Refiners explicitly approved by the Global Gold Council
Refiner approval criteria include:
Market acceptance
Delivery interoperability
Historical reliability
Auditability
3.4 Vault & Custody Standards
Eligible gold must be held in:
An Approved Global Gold Reserve Partner vault
Fully allocated storage
Non-hypothecated
Unencumbered by liens, pledges, or claims
Vaults must:
Meet Council-defined operational and security standards
Provide cryptographic attestations of custody
Support legally enforceable redemption pathways
3.5 Documentation & Metadata
Each USG-eligible bar must be:
Serialized
Assay verified
Vault-attested
Registered on-chain with immutable metadata, including:
Serial number
Purity
Weight
Refinery
Vault ID
Jurisdiction
Custody status
4. Minting Rules
When minting USG:
USG is minted strictly based on verified pure gold content
No user-defined premiums or discounts are permitted at mint
Eligible bars are placed into the USG Available Pool
Title to the bar transfers to the designated collateral trust or vault-as-agent structure
Minting always occurs at spot purity value
These rules ensure:
Uniform backing
Clean accounting
Predictable redemption
5. Redemption Guarantee
Because all USG-backing bars meet identical eligibility standards:
Any USG holder may redeem into:
≥ 0.995 fine gold
Institutional-grade delivery
Equivalent market acceptability
Redemption outcomes are:
Deterministic
Non-discriminatory
Free from quality-based slippage
There are:
No tiered redemption paths
No class-based routing
No user-specific restrictions
USG is one asset with one redemption promise.
6. Explicit Exclusions
The following may not back USG, under any circumstances:
Gold with purity < 0.995
Collector or specialty bars
Bars with persistent market premiums
Non-standard weights
Encumbered or pledged gold
Bars from unapproved refiners or vaults
Such assets may still:
Exist as Conditional Claim NFTs
Trade freely on the Global Gold Exchange
Be sold at market-determined premiums
They are excluded only from the monetary base.
7. Governance & Amendments
The Global Gold Council exclusively governs:
Eligible bar standards
Approved refiners
Approved vaults
Collateral structures
Amendments to this standard
Any change requires:
A formal Global Gold Proposal (GGP)
Council approval under applicable thresholds
Public notice and documentation
This prevents:
Arbitrary dilution
Silent collateral degradation
Backward-incompatible changes
8. Why This Standard Is Critical
This standard exists to prevent:
Phantom backing
Economically inaccessible redemption
Premium-based bar reservation
Backing quality drift
Paper-gold failure modes
And to guarantee:
Practical 1:1 backing
Institutional trust
Regulatory clarity
Long-term scalability
9. Canonical Statement
USG can only be trusted if the gold that backs it is standardized, institutional-grade, and interchangeable at redemption — not merely equal in ounces.
10. Effective Status
This standard becomes binding upon Council adoption and applies to all current and future USG issuance.
Last updated