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April 2010
DGC Magazine
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Digital Gold & Islamic Finance Special Issue
Don’t miss...”Confessions of a Carder” by Alekcey Malov on page 42
2 § DGC Magazine April 2010 Issue
http://www.e-dinar.com
DGC Magazine April 2010 Issue § 9
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(Q)Thecurrentglobalfnancialtroublehas
worked to reinforce the concept of sound money.Do you see more ‘everyday customers’ embracingthe concept of gold and turning away frompaper?
Yes, denitely. For our business, the
turning point came in October 2008
. At that time, most of the largereneries in Europe were ooded with orders and found it increasingly difcult to procure sufcient metal and to provide adequate production capacity. As a result, they started to focus their business onkey accounts – mainly banks and large wholesalers – and neglected the smaller accounts or increased their spreads several fold for immediate delivery. Due to our priority relationship with Emirates Gold in Dubai (they rene roughly 1.5 tons of gold per day), we, on the other hand, were able to continueimmediate deliveries throughout the height of the nancial crisis with only marginal increases in spreads. During the rst 4 to 5 months of the crisis,
our monthly gold production increased from 25 kg to 100 kg per month
, a 400% increase as compared to the period preceding the bankruptcy of Lehman Brothers. In that process, we gained a signicant number of strategic accounts (mostly wholesalers and large sales networks which started to add bullion productsto their traditional line of nancial products) and were able to rmly establish the Emirates Gold brand in Europe and South East Asia. Since we canmonitor the sales of our strategic customers (in a few cases, we have integrated their sales systemsinto our order management), we observe a steadybroadening of the general customer base, particularlyin
Germany, Eastern Europe and Malaysia
, whichis continuing until today. To satisfy this growing demand for physical redemption, we incorporated a Swiss wholesale company for the marketing and distribution of Emirates Gold products ( http://www.emiratesgoldeurope.com ) in the spring of 2009. It is important to note that all further commentsand numbers refer to the combined business of both
e-dinar FZ LLC and Emirates Gold Europe GmbH
.While e-dinar retains the character of a retail company, Emirates Gold Europe works as a purewholesaler.
(Q) When I interviewed you back in 2008 you said,“We do most of our minting with Emirates Gold inDubai. We have some local minting operations inIndonesia and are looking for ways to mint silverdirhams in Malaysia...” are you still minting amajority of your pieces in Dubai?
Today, we do the large majority of our minting with Emirates Gold in Dubai. While we continue tomaintain close links with an afliate organization in Indonesia which mints gold dinars and silver dirhams for the most part with the state-owned renery LogaMullia, we have ceased our minting activities with
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