Volksbank Mittweida eG is now offering its customers an NFT function when buying precious metals. The Ostdeutsche Bank takes care of the safekeeping of gold, silver, platinum or palladium itself. An anonymous image of the bars or coins, which is assigned to the personal NFT, is intended to verify the real stocks. The financial institution relies on the Ethereum scaling solution Polygon to handle the project.
Users receive an “individual NFT (non-fungible token) that can be filled with personally selected precious metals”, according to the vision. The precious metal would be secured in the vault of the Volksbank, with storage free of charge until 2025. The Volksbank only uses the blockchain as an additional feature. Because: The NFT has no rights and cannot be transferred or sold. Thomas Otto, responsible for blockchain-based business models at Volksbank Mittweida, emphasizes to BTC-ECHO:
Customers currently keep the precious metal they have bought at home, although it would be safer in the bank’s vault. Customers obviously like to hold their precious metal in their hands, or at least want to see it. The photo for the token is intended to create this visibility. The product is about individual safekeeping of precious metals in the bank’s vault. Each customer keeps their own individual inventory.
The NFT is additional information without a legal function.
All rights are secured offchain. This also makes it easier for blockchain newcomers to enter the blockchain world.
Blockchain at the bank
The blockchain gives customers access to the inner workings of the bank vault – via a photo with an assigned token ID. The bank relies on Polygon because of its sustainability and low fees. The necessary “blockchain costs” are borne by the Volksbank itself. The NFT is a technically modified ERC-1155 token, from a legal point of view a so-called “utility NFT token”.
The user himself is responsible for storing the private keys. However, if the keys are lost, there is no “risk of losing the precious metal” since the customer signs a purchase contract. Accordingly, blockchain and wallet only serve as additional tools. The NFT is also not transferable or tradable. However, the Volksbank offers a delivery option, whereby the customer receives the precious metal himself.
The bank has been dealing with the blockchain for some time. In addition to VR Bank Bayern Mitte eG, Volksbank Mittweida is one of the first to get involved in the crypto business.
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The revolutionary blockchain village in the middle of Saxony
Mittweida is only a three-hour drive from Berlin. The small Saxon town has big ambitions when it comes to blockchain. The first DAO was invented here in 2016. Later, the first blockchain master’s course on the European mainland started at the renowned university of applied sciences, which is still unique in Germany today.
With 14 million euros in federal funding, the city also wants to become the stronghold of the German blockchain scene. BTC-ECHO was there last year and spoke to blockchain pioneers, professors, citizens and the mayor. You can read in issue 60 of the BTC-ECHO magazine how a crypto valley of the east is being created in Mittweida.
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