We take risk management seriously
Monetary Metals offers two fixed income options for gold and silver owners: leases and bonds. When we present an opportunity, we disclose the identified risks and the steps taken to mitigate them. Our discussion of risks and controls is qualitative. We can identify the possibility that investors will lose gold via a particular lapse. But we cannot state it in terms of a precise statistic.
If we believed that there was a significant probability of loss—if there were risks that should be eliminated or mitigated, or if the people were not trustworthy, for example—then we would not offer the deal and risk anyone’s gold or silver.
Legal structure
Covenant-heavy contracts
Third party reporting
Continuous monitoring
Secure logistics
How Monetary Metals protects investor gold and silver in leases
At Monetary Metals, protecting investor metal is our top priority. Before any lease is offered, we conduct a rigorous nine-step due diligence process to evaluate lessees and safeguard investor metal. These measures ensure that leased gold is secure, traceable, and used responsibly. Delaware law offers strong protections for creditors and corporate governance
These steps, taken together, greatly increase confidence that investor metals are protected and the lessee will perform its lease obligations.
Establishing business need
The use case must be well-defined and operationally sound. Each lease begins by identifying the economic rationale for leasing gold. For example, are they looking to finance a work-in-progress or are they freeing up equity capital?
Mapping gold flows
We trace the entire journey of the gold within the lessee’s process. Without complete visibility into how and where the gold changes form, and who handles it at each step, no lease is approved.
Security and internal controls
Physical and procedural security measures are non-negotiable. These included vaulted storage, third-party custody, 24/7 surveillance, ERP-based inventory tracking, and strict access controls.
Management vetting
We assess the integrity and track record of lessee leadership. From anti-money laundering screening on executives and signatories, to credit and criminal checks. We leave no stone unturned in our management vetting process.
Legal structure
All leases are issued through Monetary Metals Treasury, LLC, a series LLC structure based in Delaware.
Delaware laws offer strong protections for creditors and corporate governance.
Financial strength analysis
Liquidity—sufficient cash flow to cover interest;
Leverage—debt-to-equity ratio;
Inventory—sufficient inventory relative to lease;
Covenants—failure to meet financial ratios may result in lease termination and metal repossession
Legal safeguards
To mitigate non-performance risk, we provide layers of protection by requiring corporate guarantees, UCC filings and, in some cases, personal guarantees. If a lessee fails to meet their obligations, Monetary Metals has legal and financial avenues to recover value.
Insurance
Every lease includes comprehensive, robust insurance coverage. All lessees must fully insure leased metals and name Monetary Metals as loss payee. We also have a supplemental insurance policy to cover gaps not handled by lessees’ policies.
Ongoing monitoring and reporting
Contract compliance is strictly enforced. Some of the ways we do this is via daily inventory reporting, independent audits, maintaining separation of leased vs. owned metal using unique identifiers.
We only make money when our clients make money
We only earn revenue if the lease performs and pays. If the lease does not perform, then we earn no revenue.
This powerfully aligns our interest alongside our clients. We are motivated and incentivized to only do the deals we are confident will perform in full.
How Monetary Metals protects investor gold and silver in bonds
Capital preservation and disciplined underwriting are core to our investment process. Our secured gold and silver bond programs are built on a comprehensive, multi-disciplinary due diligence framework designed to assess, monitor, and mitigate risks throughout the investment lifecycle. All transactions are governed by rigorous technical, legal, and commercial standards.
Bonds extend credit to the borrower and the gold or silver becomes an asset on the borrower’s balance sheet. The risk is generally higher than with a lease. And the interest rate is accordingly higher.
Some top questions on our risk and mitigation strategies
We only finance projects that are either producing gold already and undergoing expansion or projects that are near production and need a final capital infusion to produce gold. Early-stage exploration or conceptual projects are excluded.
Borrowers must demonstrate a clear path to cash flow and debt repayment within the term of the bond. Independent validation of capital costs, operating costs, mine schedules, and economic assumptions against industry benchmarks is required.
Only projects with sufficient tangible value (plant, equipment, real estate, inventory, receivables, mineral rights) are eligible for financing. Bond coverage ratios (NPV/Loan, Security Value/Loan, Payback Period) are tested under base and downside scenarios.
Our bonds are senior secured debt, with full security over project assets, mineral rights, and key operating infrastructure. In the event of default, Monetary Metals has legal remedies to enforce liens and liquidate collateral.
No. The benefits to business leasing or loaning gold for their financing needs is that it eliminates the price exposure usually associated with dollar-based financing schemes. Miners can focus on mining gold and jewelers can focus on creating jewelry, not hedging gold prices.
Lessees prefer to lease metal rather than buy it outright so that they can eliminate their price exposure. They owe lease fees to Monetary Metals clients in ounces of gold, not dollars.
Borrowers owe payments in gold, matching their liabilities (gold principal and interest payments) with their assets (gold production).
Clients will see their yield and interest payments denominated in gold, regardless of the dollar price of gold.
No. With over 75 funded opportunities and thousands of ounces paid to our clients, we are proud of our track record and our ability to serve our clients. We take risk mitigation seriously while offering yield on gold paid in gold to our clients.
Client gold is safeguarded in segregated accounts with independent vaulting partners, and is never commingled with Monetary Metals’ corporate assets.
Even in the unlikely event of Monetary Metals’ insolvency, client gold remains the property of clients. Full legal title and ownership of client gold always stay with the client, even when leased for a return.