Edelcoin: A cryptocurrency backed by industrial metals

Fresh from Switzerland: Edelcoin, the first cryptocurrency backed by various industrial metals. The project has minted its first tokens worth six billion dollars – and it has grand plans. The founder shares some details with us.

When Andreas Wiebe talks about how Edelcoin began, he likes to start from the beginning. The native of Bonn, now living in Switzerland, has been an IT entrepreneur for a long time. He has built search engines, worked with AIs early on, and developed a messenger.

Wiebe sees himself as both a businessman and an idealist: „We build alternative solutions to what the Americans build. With our search engine, we offer an alternative to Google, and with our messengers, to WhatsApp. On this path, we also came to cryptocurrencies.“

Andreas Wiebe has his interpretation of Bitcoin: „I am convinced it was set up by BlackRock. They realized the dollar wouldn’t last indefinitely, so they let it go and replaced it with Bitcoin.“ And when the dollar falls – all currencies fall too. „We are witnessing the great disenfranchisement, the great collapse.

And this is where Edelcoin comes into play, a cryptocurrency set up by Wiebe and his team. „We wanted to build an alternative that provides security. And what is secure? Metals, for me, are the only thing that is sustainably solid because they will always be useful.“

Copper and Nickel, Polygon and Ethereum

Initially, Edelcoin was supposed to be backed by precious metals like gold and silver. Hence the name. But during the planning, Wiebe changed his mind. „Gold isn’t much different from Bitcoin; it’s volatile. So we created a basket of five metals, which are primarily used industrially.“

Most of the backing for Edelcoin comes from copper isotopes, with a good amount of nickel, and a bit of radium for balance. These are metals, according to Wiebe, that are in demand in the chip manufacturing industry.

Edelcoin has since been launched. It is an ERC token on Polygon and Ethereum. So far, there are Edelcoins worth around six billion dollars. They can be traded on the first exchanges, though mostly on niche ones, and the price has remained largely stable. However, around 99% of the tokens are held in two addresses, which slightly skews the price’s significance.

Holders of the coins can have the metals physically delivered, although the process through a trustee is somewhat complex.

Soon, Wiebe’s team will also develop their wallet, which will be connectable with debit cards. The founder hopes that Edelcoin will then be used for payments across Europe.

A Dizzying Copper Mountain

Appropriately, Wiebe found an investor who sat on a massive stockpile of these metals. He originally used them as a basis for banks to offer leveraged products. However, with the demand for such derivatives declining, the investor does not want to sell the metals but is looking for a new application.

Edelcoin fits almost perfectly: industrial metals are made liquid through the token without flooding the market and crashing the price.

We won’t provide specific details on the size of the stockpile here. But it’s dizzyingly large, which can be seen as either good or bad, depending on one’s perspective. It could make Edelcoin questionable, given the logistics involved are unimaginably complex and expensive; but it also highlights the vast ambitions of Edelcoin and the project’s enormous potential.

You can think of it as a kind of „Proof of Work.“ Just as Bitcoin miners prove that work backs Bitcoins through hashes, the metal logistics prove the work behind Edelcoin.

And the Business Model?

One somewhat open question is what business model Wiebe and his partners plan to use to cover the costs. After all, storing such a quantity of valuable metals is not exactly cheap.

„Our plan is to reinvest the proceeds from the sale of precious metals into gold mines,“ he explains. „This offers users who redeem their Edelcoins the option to receive gold as well. At the same time, we generate revenue through transaction fees. It’s a solid plan, but it requires patience.“

Initially, Wiebe needs to invest. Transportation costs have already been covered, but significant monthly sums are required for storage, and the technology needs funding as well. Additionally, regulation consumes a lot of time and resources, particularly the challenges of MiCA in securing full approval for the EU market. A fintech license via a white-label bank could help improve the product further.

Despite the challenges, the Swiss entrepreneur is betting that the effort and investment will eventually pay off – through a digital and stable currency that offers an alternative to the euro, dollar, and Bitcoin.