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ALPINE — A new local currency is gaining traction in the age of COVID-19. As we jump into the holiday shopping season a growing number of small businesses across the state now accept what are called "goldbacks."
"I think we usually call it a complementary currency," said Jeremy Cordon, president of Goldback.
The company based in Alpine launched in 2019, producing and selling gold that's broken down and encased in two layers of polymer.
"You tell them they have a thousandth of an ounce of gold and it cost three bucks? It just captures the imagination immediately," Cordon said.
They first started selling goldbacks out of their office to people in Utah as a local currency. It has since grown and now most of its sales come from out-of-state through several online retailers in the precious metal arena.
"Because normally if you want to buy gold you're looking at like a $2,000 coin. And that prices most people out," Cordon said. "It's not that people don't want to own gold — it's just that's a very high bar to start owning gold. If that price is $3, everybody can own gold."
In April, Cordon saw sales skyrocket from selling about $100,000 worth of goldbacks in one month to more than $1 million a month.
"It's like working at the toilet paper factory," Cordon said, referring to the sudden huge demand for toilet paper over the spring. "The people that are worried about our currency losing value kind of look at goldbacks as a backup."
Since the start of the pandemic, millions of dollars worth of these have been sold. And a growing number of Utah businesses are accepting them as a local currency. We talk to the president of #goldback and some of the businesses accepting them. @KSL5TV at 10pm pic.twitter.com/TBxXJkCjlD— Matt Rascon KSL (@MattRasconKSL) November 28, 2020
And during a holiday shopping season when local businesses are hurting more than usual, goldbacks give consumers another reason to shop local.
"We don't look at it as an investment. We look at it as an insurance policy," said Dallin Steinman, general manager at Zapplz in American Fork.
Steinman was among the first businesses to agree to accept the currency and be featured on Goldback's website.
"Who really knows what's set for the future. But having physical gold in your hand definitely helps," he said.
Steinman said they don't see goldbacks come through their caramel apple shop often, but when they do, they look up the current exchange rate on Goldback's website and then offer change in dollars in return for the purchase.
The goldback also comes in a five, which contains five times the amount of gold as the one, and a 10, 25 and 50 — each one larger than the previous.
"They are quite revolutionary for gold," said Micah Turner, who accepts goldbacks as payment at his shop, Turner Auto Repair.
"It's like a way better than bitcoin kind of deal in my mind," he said. "I mean if worse comes to worst, it's gold. Somebody will buy it."
Cordon said Utah is an ideal spot for goldbacks because of a 2011 law that Governor Gary Herbert signed.
According to the website, "The Goldback project truly began in spirit with the passage of the Utah Legal Tender Act in 2011 which recognized certain types of gold as currency within the state. Since that time the technology to mint gold into a spendable form for small transactions has come to fruition. Goldbacks may be used almost anywhere in the world for barter transactions."