Mac Musings

You've Got Gold?

Daniel Knight - 2001.12.21

New payment schemes are popping up all over the place. Kagi has been around for ages, PayPal is pretty well established, even got into the act, and we talked about Paythrough at the end of November.

This time a reader emailed, said he didn't care to use PayPal, but would I take a donation of e-gold? Huh, what's that?

To find out, I logged onto the e-gold website and looked around. Accounts are free, and you don't need to provide a credit card or bank account information to get one. Nice.

The big point behind e-gold is creating an online currency that isn't tied to the U.S. dollar, the euro, or any other currency. Instead, transaction are handled in virtual gold. You can buy and sell using decimal troy ounces or grams - or in whatever a specifice number of U.S., Canadian, or Australian dollars will buy today, not to mention the Japanese yen and several European currencies scheduled to disappear on January 1.

Virtual gold doesn't mean the gold isn't real, only that it's all tracked electronically. e-gold currently has 138 gold bars in vaults around the world. Your gold is part of one of those 400 troy ounce bars. (If you don't care for gold, they also offer e-silver, e-platinum, and e-palladium.)

The nice thing about e-gold is that it's simply there. You can access your e-gold account from anywhere in the world. Those 400 oz. bars just sit there, secure. And it's easy to transfer your virtual gold to someone who uses a completely different currency.

The unusual thing about e-gold compared to currency is that the value of gold isn't fixed. It goes up. It goes down. The value of your e-gold can vary from day to day.

The cost of using e-gold seems pretty reasonable. As I understand it, they take 1% of each transaction, so if someone donates 1 gram of e-gold to account 432599 (that's Cobweb Publishing, the business behind Low End Mac), e-gold gets 0.01 gram and I receive 0.99 gram. There's also a 1% fee when I convert my virtual gold to real currency, so that 0.99 gram become 0.9801 gram when I cash it in.

As far as I can tell, the only other fee is 1% per year for gold storage.

It's certainly an interesting concept. Being in the States where the bulk of our site visitors and donors live, I find it much easier to work in U.S. dollars, but I can see where this could be much simpler and less costly for those outside the U.S.

We've set up an e-gold which can be used for site donations and purchase of items from the Cobweb Publishing Store.