Allocated Storage

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Real-World Assets • Bullion • Physical Collateral

segregated precious metal custody

Allocated Storage refers to a custody method where specific bars or quantities of a precious metal — such as gold or silver — are individually assigned and held in a secure vault on behalf of the rightful owner. The metal remains the legal property of the owner and is not commingled with other assets or used by custodians for lending or collateral.

Use Case: By holding KAU or KAG, users benefit from fully allocated storage — where every token corresponds to real, legally assigned bullion stored in insured vaults.

Key Concepts:

Direct Ownership — Each unit of metal is legally assigned to the holder
Physical Segregation — Assets are not pooled or reused by vaulting providers
Redemption-Ready — Owners can claim specific bars for delivery at any time
Risk Mitigation — Eliminates counterparty and lending-based custodial risk

Summary: Allocated Storage is the most secure form of bullion custody — providing transparency, full legal title, and trust. It forms the backbone of tokenized metals like KAU and KAG, ensuring that digital assets are truly backed by tangible wealth.

Feature	Allocated Storage	Unallocated Storage
Ownership	Specific bullion legally assigned to owner	General claim on pooled metal reserves
Risk Profile	Low — Full control and redemption rights	Higher — Subject to custodian solvency
Vault Use	No rehypothecation or lending	Assets may be loaned or collateralized
Auditability	Full — Serial numbers and bar lists tracked	Limited — No assigned physical inventory
Examples	KAU, KAG, vaulted private bullion	ETFs, pooled accounts, paper gold

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