I rarely write about gold these days, but the following from Reuters caught my attention.
BEIJING/SHANGHAI, March 7, China’s virtual gifting market, typically the domain of plugged-in young consumers celebrating special occasions or flirting, is luring major financial institutions keen to boost trade of another auspicious commodity: gold.
Tencent’s digital gold packets, known as “microgold”, are backed by the country’s biggest bank, Industrial and Commercial Bank of China (ICBC). They allow users to send funds that track the real-time value of gold to friends over the firm’s popular messaging platform WeChat.
It’s a financial innovation on the concept of virtual gifts, such as digital roses and chocolates, more commonly used in online communities and which have more sentimental value than any tangible economic worth.
For financial institutions, China’s booming virtual goods and smartphone-driven exchanges offer new markets to boost trading volumes in everything from banking services to gems.