Understanding the NUBX Tokenisation Process

The NUBX architecture is deliberately designed to ensure that each token is always fully backed by physical gold and that the process from vault to blockchain is transparent and auditable. Below we describe the four core stages of the lifecycle: custody, minting, proof and redemption.

1. Gold Custody

Selection of Custodians: The physical gold backing NUBX is stored in vaults operated by globally recognised bullion custodians. These providers are carefully vetted for their adherence to London Bullion Market Association (LBMA) standards, security protocols and insurance coverage. The gold bars held in custody are LBMA‑good delivery bars, uniquely numbered and traceable. The selection of custodians is a critical risk management measure – by spreading storage across multiple jurisdictions and providers, Nubia minimises single‑point failure risk.

Special Purpose Vehicle (SPV) Ownership: Legal title to all gold sits with a special purpose vehicle incorporated in the Abu Dhabi Global Market. This SPV is ring‑fenced from Nubia’s operating entity, ensuring that any corporate liabilities do not encumber the underlying assets. The SPV is governed by a board that includes independent directors to oversee fiduciary duties and regulatory compliance.

Auditing & Insurance: Third‑party auditing firms conduct periodic assessments of the gold bars, verifying weights, serial numbers and compliance with LBMA standards. Reports are published and, where possible, hashed onto the blockchain. Insurance policies cover the full value of the gold in custody, protecting against theft, damage or other loss events.

2. Token Minting

For every gram of gold held in custody, one NUBX token is minted. This process is controlled by a smart contract that ensures the total supply cannot exceed the verified reserve. Only authorised custodians can trigger the minting function, and such triggers are executed through multi‑signature wallets requiring consensus from independent trustees. Each mint transaction includes metadata linking it to a specific vault receipt.

The minting contract is deployed on multiple blockchains to maximise interoperability. Presently, we support Ethereum, with plans to integrate with other ecosystems via bridges and cross‑chain communication protocols. All minting events are transparent and can be viewed on the NUBX explorer. Additionally, the underlying code is open‑source and has undergone security audits by independent firms. This openness is consistent with best practices championed by other leaders.

3. Proof of Reserve

At the heart of NUBX’s trust model is proof of reserve. To demonstrate that the number of tokens in circulation matches the amount of gold held, Nubia publishes regular attestation reports. Auditors examine the SPV’s holdings and compare them to the total supply on‑chain. The results: Including bar serial numbers, weights and vault locations are made public. We also employ on‑chain oracles to push updates about balances directly into smart contracts. This mechanism allows DeFi protocols to verify in real time whether collateral is sufficient.

Proof of reserve isn’t only about numbers; it’s about processes. We ensure that each redemption decreases the total token supply and triggers an update to the public ledger. By making these actions visible, we give users confidence that there is no double counting or hidden leverage.

4. Redemption & Settlement

NUBX can be redeemed for the underlying gold or the cash equivalent. Redemption requests follow a compliance workflow: customers submit KYC documentation and specify whether they want physical delivery or fiat settlement through regulated partners. Once compliance checks are completed, tokens are burned and the gold is either delivered or sold to generate fiat. Settlement partners operate in accordance with the rules of ADGM and VARA.

Redemptions are processed on a first‑in, first‑out basis to ensure fairness. Fees reflect the cost of shipping, handling and administrative processing. In the near future, we plan to integrate with local exchanges in multiple jurisdictions, enabling redemptions and conversions to occur seamlessly. This redemption function underscores the fundamental promise of NUBX: it is always convertible into a gram of gold, providing a hard floor to its value.

Security Practices

We place great emphasis on security. Smart contracts undergo regular audits, multi‑signature wallets control administrative functions and our servers follow strict cybersecurity protocols. Customer data is protected using encryption at rest and in transit. When handling redemptions or account changes, we require multi‑factor authentication to prevent unauthorised access. These measures align with industry best practices and are necessary to maintain the integrity of a system that aims to combine the best of traditional and decentralised finance.

Through these mechanisms, NUBX realises the promise of a transparent, compliant and reliable gold‑backed digital asset. Read on in other sections for details about how our yield layer operates and how our governance frameworks provide oversight.