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Canadian Gold Mine Put on Sale for $2 Million in Bitcoin

Canadian Gold Mine Put on Sale for $2 Million in Bitcoin

By Reuters | Updated: 13 June 2014 18:34 IST

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Gold, the hard asset long seen as the ultimate hedge against risk, has fallen so much out of favor in recent years that the owner of a mine in Canada's historic Yukon gold belt wants to sell the property for $2 million in Bitcoin, a virtual currency.

The tiny, producing mine is being offered for sale by an unidentified seller on BitPremier, a self-described Bitcoin marketplace for "luxury items and opportunities".

The mine, located right in Dawson City, the heart of the 1890s Klondike Gold Rush, has the potential to produce up to 4,000 ounces of gold a year, worth $5.9 million at current prices. The sale includes $1 million worth of equipment.

"A well-respected, fully compliant and profitable company, any new buyer could recoup their initial investment in as little as two mining seasons," the sales advertisement says. It does not say whether the owner would consider any other form of payment besides Bitcoins.

Prices for gold have slumped by a third in the past 2-1/2 years after a decade-long rally, leaving many mines struggling to stay profitable.

Bitcoin is the most prominent of a group of so-called virtual currencies created by computers and accepted by some retailers as payment on the Internet or in shops. Enthusiasts are drawn to Bitcoin's ideals of transparency and a lack of central or official control, and use the digital currency as a hedge against currency fluctuations. But critics say the near anonymity of transactions makes Bitcoins a magnet for drug transactions, money-laundering and other illegal activities.

Recent mishaps, including a bankruptcy fling from Mt Gox, a Bitcoin exchange, has brought the technology under heightened scrutiny and seen the value of one Bitcoin slide to about $610 from above $1,000 late last year.

© Thomson Reuters 2014

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