COO of Novem, Fouad Soulatana, recently participated in an interview on Jaime the Crypto Koala’s podcast. Novem is a gold storage and asset management company that seeks to establish an international chain of gold stores. In the interview, Soultana discussed the advantages blockchain offers, reasons for choosing the Neo blockchain, how Novem is different than other gold projects, and Novem’s next steps forward.

Additionally, Novem has minted NNN tokens twice in November 2019. First, on November 28th, minting 258,659 NNN tokens. Second, on November 29th, minting 81,300 NNN tokens. Each NNN token corresponds to 0.01 grams in stored gold. To date, Novem claims to store 31.15743 kilograms of gold in its facilities, represented by 3,115,743 NNN tokens in circulation.

Advantages blockchain offers

Soultana outlined his belief that blockchain introduces advantages to the gold buying and selling process. Specifically, the removal of intermediaries and ownership of the underlying asset.

Traditionally, to buy and sell gold, investors needed to do so through physical brokers that take a percentage of the trade. Blockchain offers the benefit of removing intermediaries, and providing a peer-to-peer standard to trade (representations of) gold.

Blockchain offers ownership of the underlying asset, as NNN token holders claim rights to their gold stored with Novem. Soultana stated, “When you’re the token owner, you’re also the gold owner.” This contrasts other forms of gold-backed assets such as exchange traded funds (ETF). With a gold ETF, shareholders can not redeem their share for physical gold. Whereas, with tokens, users can exchange the NNN token for physical gold.

Further, blockchain doesn’t only increase access to retail investors but also offers benefits for institutional entities. Soultana said:

[Institutional players] can move 1,000 kilos [of gold] within 15 seconds. Instead of shipping it, taking a month [to move] from one country to another, and working on paperwork, and having a lot of costs like insurance, and customs. Now, with blockchain, you can trade whatever amount [of gold] you want, large or small, in seconds.

Reasons for building on Neo

Novem utilizes a dual-token model comprised of NNN and NVM tokens, both of which are NEP-5 standard. NNN tokens are backed by gold stored in a high-security warehouse. NVM is a utility token that can be used to purchase goods and services from Novem.

In the interview, Soultana was asked about Novem’s thought process behind selecting to build using Neo. He responded, “Before we partner with any company, we always look at the vision of the company. So, where’s this company headed? What do they want to achieve in the future?”

After performing its due diligence, the team opted to use Neo for three reasons.

First, Neo aims to offer the ability to tokenize assets and to be a platform for tokenized assets.

Second, developers don’t need to learn a new programming language to code a smart contract. Instead, they can code in a language with which they’re already familiar.

Third, Novem needed a blockchain with high transaction speed. Soultana offered the example that customers standing in line in physical stores want quicker transaction times, as opposed to waiting three to ten minutes for a transaction confirmation.

How Novem differs from other gold-backed token projects

First, Soultana stated the precious metals industry is a “handshake” oriented business that requires time to develop trusting relationships. Relationships that Novem founders, Wolfgang Schmid and Mario Schober, have developed with more than 20 years combined in the precious metals industry.

In addition to established relationships, gold brokers must also have access to storage facilities and refineries to source gold. Both of which, Soultana states, Novem offers.

Secondly, Novem recently launched its first physical store in September 2019, with plans to launch up to 100 brick-and-mortar locations.

Soultana states the physical stores offer the benefit of revenue generation. Novem intends to use profits from sales and trades in the gold stores to burn the NVM token supply. Additionally, he believes the stores help educate users about blockchain through the front-end activity of purchasing gold from physical stores. This way, the user never knows they’re using blockchain, but witnesses the benefits of ownership of the underlying asset that blockchain offers.

Looking forward

In the next two years, the Novem team intends to focus on growing the ecosystem and moving into the “DeFi” vertical to develop more applications for the token.

Soultana iterated, the team is working with a variety of projects on potential applications, but are not able to publicly disclose and partnerships. However, Novem aims to discuss the results of these partnerships publicly in Q3 2020.

The full interview can be found at the link below: