a_unique_person
Director of Hatcheries and Conditioning
I did some internet searches on this.
The concept is fine. You buy one ounce of gold, get a block-chain transaction showing you own the gold, and one ounce of physical gold is taken from their stock and put into a depository for you (and future owners as people transact with it).
Problems.
1. The gold can be stolen from the Perth Mint depository. In 1982 68 kilograms were stolen and never recovered.
2. You may be buying gold that the mint says is stored for you but is only "paper-gold", meaning they don't actually have the gold in the depository, and could not meet the demand if everyone cashed in. Like fractional banking. See the link:
http://www.marketskeptics.com/2009/02/warning-about-perth-mint-gold.html
3. The gold could be confiscated by the government.
4. There is a limited supply of gold, but the price is determined by the gold market and not the demand for this "crypto-gold". It is likely torun outrocket up in price. Apparently there is not a lot of gold that they have for sale in the first place.
FTFY.

The mint is owned by the Government.

If this thing takes off they will be able to buy as much gold as they need to. If the price goes up they don't need as much gold anyway.
I can quite confidently say that this will kill bitcoin.
