Technical Specifications
ESCUDO (Gold Token)
PESO (Silver Token)
Custody Architecture
Storage Models
Allocated Storage (Individual Investors)
Bullion stored in shared vault facilities with allocated inventory. Each token holder has proportional claim on pooled reserves. Metal is fungible and liquid—any compliant ounce can fulfill redemption requests. Total allocated metal matches circulating token supply with daily reconciliation.
Segregated Storage (Institutional Clients)
Private vault compartments with physically separated inventory. Metal is specifically earmarked to institution's account with individual bar serial numbers recorded. Available for accounts meeting $1M minimum threshold. Additional annual fee: $10,000.
Vault Infrastructure
- •Location: U.S.-based facilities operating under American jurisdiction
- •Insurance: Lloyd's of London coverage for full replacement value
- •Security: 24/7 monitoring, multi-signature access protocols, armed response
- •Compliance: Regular audits by independent third-party firms
- •Access Control: Biometric authentication, video surveillance, tamper-evident seals
Audit Framework
Quarterly Independent Audits: Third-party verification firms conduct physical inventory counts and reconcile against on-chain token supply. Audit reports published publicly within 30 days of completion.
Daily Internal Reconciliation: Vault management system reconciles physical inventory against blockchain token supply. Discrepancies trigger automatic alerts and investigation protocols.
Annual Compliance Review: External legal and financial compliance assessment of custody operations, insurance adequacy, and regulatory adherence.
On-Chain Verification System
Proof-of-Reserves Mechanism
Daily Publishing: Total vault inventory (in troy ounces) published on-chain daily at 00:00 UTC. Cryptographic hash of physical inventory records ensures tamper-proof verification.
Public Verification: Anyone can independently verify that total token supply matches published vault inventory. Blockchain transparency eliminates reliance on trust-based attestations.
Real-Time Supply Tracking: Total circulating supply visible on Solana blockchain at all times. Minting and burning events are public, immutable, and instantly verifiable.
Smart Contract Architecture
- •Minting Authority: Multi-signature control requiring vault operator + compliance officer approval
- •Burning Mechanism: Redemption requests trigger automatic token burn upon physical metal withdrawal
- •Transfer Protocol: Standard SPL Token transfers—no platform lock-in, fully interoperable
- •Emergency Pause: Multi-sig authority can freeze minting (not transfers) in case of vault security breach
Transparency Dashboard
Public dashboard accessible at /proof-of-reserves displays real-time verification metrics:
- • Total ESCUDO supply (on-chain query)
- • Total PESO supply (on-chain query)
- • Vault gold inventory (troy oz)
- • Vault silver inventory (troy oz)
- • Backing ratio percentage (should always be ≥100%)
- • Last audit date and report link
- • Vault inventory hash (cryptographic proof)
Redemption Mechanics
Token Burning Process
- 1. Redemption Request: Token holder initiates redemption via platform interface, specifying delivery method (mail/in-person) and quantity.
- 2. Token Lock: Specified tokens locked in escrow smart contract pending physical metal preparation.
- 3. Vault Withdrawal: Physical metal removed from vault inventory, weighed, quality-verified, and packaged for delivery.
- 4. Token Burn: Upon successful metal withdrawal, tokens permanently burned from circulation. Supply automatically decreases on-chain.
- 5. Delivery: Metal shipped via insured carrier or made available for in-person pickup. Tracking provided.
Redemption Requirements
Settlement Timeline
Why 1 Troy Ounce Standard?
Industry Alignment
The 1 troy ounce standard aligns with global precious metals markets and institutional practices:
- •LBMA Good Delivery: London Bullion Market Association standard for institutional gold (400 oz bars divisible into troy ounces)
- •COMEX Contracts: Major futures exchanges price in troy ounces—enables direct hedging strategies
- •Retail Accessibility: 1 oz coins (American Eagle, Canadian Maple Leaf) are most liquid physical products
- •Pricing Transparency: Spot prices universally quoted per troy ounce—simplifies valuation
Institutional Benefits
Portfolio Integration: Standard troy ounce units integrate seamlessly with existing treasury systems and risk models. No conversion calculations required for balance sheet reporting.
Hedging Compatibility: Direct correlation with COMEX futures enables institutional hedging strategies without basis risk from non-standard unit sizes.
Liquidity Depth: Full ounce standardization creates deeper secondary market liquidity versus fractional denominations—critical for large position exits.
Individual Investor Benefits
Professional-Grade Units: Own the same standard used by institutions and central banks. No "retail-only" fractional products.
Easy Redemption: 1 oz units match common bullion products (coins, rounds, small bars) available from any dealer—simplifies resale if needed.
Digital Divisibility: While tokens represent full ounces, blockchain enables fractional ownership through decimal places (8 decimals = 0.00000001 precision). Buy partial tokens, redeem when you accumulate full ounces.
Token Lifecycle Management
Minting (Token Creation)
New tokens are minted only when physical metal is received and vaulted:
- 1. Customer purchases metal via platform (USD payment)
- 2. AA Custodia acquires metal from approved refiners/dealers
- 3. Metal delivered to vault, weighed, assayed, and logged
- 4. Vault custody confirmed, smart contract mints equivalent tokens
- 5. Tokens transferred to customer's wallet address
Note: No tokens exist without corresponding physical metal in custody. Supply expansion requires metal acquisition first.
Burning (Token Redemption)
Tokens are permanently removed from circulation when metal is redeemed:
- 1. Token holder requests physical redemption
- 2. Tokens locked in redemption escrow contract
- 3. Vault prepares corresponding metal for delivery
- 4. Upon shipment/pickup, tokens permanently burned
- 5. Total supply decreases, backing ratio maintained
Note: Burned tokens cannot be recovered. Metal leaves custody permanently.
Transfer & Trading
Tokens operate as standard SPL tokens on Solana—fully transferable peer-to-peer without platform intermediation. Holders can send tokens to any Solana wallet address. Secondary market trading permitted. AA Custodia does not control or restrict transfers post-minting.
Security Architecture
Multi-Signature Controls
Minting Authority: Requires 2-of-3 signatures (Vault Operator + Compliance Officer + CEO). No single individual can mint tokens.
Vault Access: Physical vault entry requires dual authorization from independent parties with biometric verification.
Emergency Freeze: Smart contract pause function requires 3-of-5 board signatures—prevents unilateral action.
Custody Insurance
Coverage: Lloyd's of London policy covering full replacement value of all vaulted metal.
Perils Covered: Theft, fire, natural disaster, employee dishonesty, mysterious disappearance.
Transit Insurance: Separate coverage for metal in transit during redemptions (carrier-provided).
Note: Insurance does not cover market price fluctuations—only physical loss or damage.
Disaster Recovery
In case of catastrophic vault failure or loss, insurance proceeds used to purchase replacement metal. Token holders retain full claims—tokens are not burned until physical delivery occurs. Insurance settlement timeline: 30-90 days for full inventory replacement.
Regulatory Framework
Legal Structure: AA Custodia operates as a U.S.-registered precious metals dealer and custodian. Tokens represent bailment receipts for allocated metal—not securities or financial instruments.
KYC/AML Compliance: All customers undergo identity verification per Bank Secrecy Act (BSA) requirements. Ongoing transaction monitoring for suspicious activity. CTR/SAR filing protocols implemented.
Tax Treatment: Tokens treated as collectibles for U.S. tax purposes (28% long-term capital gains rate). Redemptions are taxable events. Consult tax advisor for specific guidance.
Jurisdiction: All operations, custody, and dispute resolution governed by U.S. law. Customer agreements specify North Carolina jurisdiction.
Architecture Summary
ESCUDO and PESO tokens combine institutional-grade precious metals custody with blockchain-based accessibility and transparency. The 1 troy ounce standard ensures compatibility with existing market infrastructure while maintaining redemption accessibility for individual investors.
Daily on-chain proof-of-reserves, quarterly independent audits, and multi-signature security protocols provide verification without requiring trust. U.S.-based custody infrastructure eliminates cross-border risk while serving both domestic individual and institutional investors.
Every token represents verifiable claim on physical metal—redeemable, transferable, and transparently backed.