Goldback

The Goldback is a family of local currencies marketed in five U.S. states and launched by Goldback, Inc. in Utah in 2019. Goldbacks contain a thin layer of gold within a polymer coating.

Overview
Goldbacks are shaped like regular currency notes but contain 24K gold. The gold is contained between two layers of clear polyester, which add artistic elements to the fractional gold bullion they contain. The term "Goldback" refers to each unit of the currency and is 1/1000 of an ounce of pure gold. The Goldbacks are issued in "denominations" of 1, 5, 10, 25, and 50, each containing proportionally larger amounts of gold. The notes are minted by Valaurum, a private mint. Valaurum uses a vacuum deposition process to fuse gold together into thin sheets encased in a plastic film designed to hold the gold. More than US$20 million worth of Goldbacks have been manufactured and circulated, although an up-to-date market cap is not published. While it is sold as a "local currency" (see below) only in five regions, they have been more broadly purchased as a gold product or for their collector's value.

The Utah goldback was launched in 2019, with series for Nevada, New Hampshire, Wyoming, and South Dakota launched in 2020, 2021, 2022, and 2023 respectively.

Reported use
KSL 5 TV, the NBC affiliate of Salt Lake City, reported a small number of local businesses accepting using Goldbacks for everyday transactions.

In association with members of the libertarian Free State Project in New Hampshire, widespread use has been reported of people spending Goldbacks on various goods and services within the state.

Design
Each Goldback features a figure, symbolically representing a cardinal virtue. Which virtues are represented and how they are represented varies according to the state series and region it serves. While each series is different in design, they are all interchangeable and contain the same amount of gold.

The Utah series depicts the virtues of Liberty, Victory, Justice, Truth, and Prudence. The Nevada series depicts the virtues of Liberty, Fortitude, Justice, Wisdom, and Charity, while the New Hampshire series depicts the virtues of Liberty, Fortitude, Foresight, Truth, and Grace (or Gratitude). The Wyoming series depicts Liberty, Loyalty, Trust, Boldness, and Reverence. The South Dakota series features Liberty, Honor, Harmony, Industry, and Peace. All five Series also feature animals and plants native to the states.



Local Legislation
The Goldback has not been formally adopted by any state government and is privately issued. In Utah, the Utah State Legislature expanded the definition of gold for legal tender—explicitly making gold with a "polymer holder" or "coating" is not subject to the state sales tax—specifically any metal that, "...has a gold, silver, or platinum metallic content of 50% or more, exclusive of any transparent polymer holder, coating, or encasement..." The first Goldbacks were made for Utah, partly as a result of the legalization of gold and silver as legal tender in Utah in 2011 as part of the Utah Legal Tender Act, and partly because the founder and first employees were based out of Utah, which has a strong culture of precious metals collecting and appreciation.

The company behind the Goldback built in features to ensure that Goldbacks cannot be confused with government issued legal tender, such as the United States dollar. In order to avoid issues with Federal counterfeit laws, each Goldback is printed with statements such as, "Voluntary negotiable instrument" and "For circulation in Utah", "For circulation in New Hampshire", or "For circulation" specific to whichever state the particular Goldback in question was 'printed' for. Also, the text "Privately Issued, Not U.S. Dollar Legal Tender. US & International Patents Pending" appears on each Goldback (of all denominations).

Criticism
Some commentators have stated that one potential downside of the Goldback is the premium that each Goldback costs over the spot price of gold embedded within each note. Currently the premium to the gold price is around 100%.