Can you explain in which way the Private keys correspond to the ownership of the physical gold stored? Is the gold only redeemable by private key and in no way by your request without being provided that key on behalf of an owner to make the redemption?
Great question and I will add this question and answer to the FAQ, as well.
We have one custodian partner with whom this is currently working and for which we are still testing, but our approach is as follows:
Step 1: Customer who purchase gold through our platform will supply us a bitcoin address to send their Counterparty Goldcoin. We will assume that they are the owner of the address and they have the private key for that public address.
Step 2: We track the public address of each Goldcoin we issue on Counterparty and update our custody database which we share with our custody partner.
Step 3: We have provided our custody partner a digital signing application that requires the owner of the public address to digitally sign our redemption verification message with their private key. Only successful signature will allow for the release of the gold and they still need to provide contact information at redemption, as well.
Given that we don't have the private key, we cannot sign for the gold ourselves.
What do you think? Does this sound reasonable?
It sounds promising. How is this going to work if someone sells their Goldcoin on the DEX to another person? It will now be associated with a new Pub/Priv key. Will the application in question use an active Node to verify the Blockchain?