You can now pay for breakfast with gold

Glint is a new debit card based on gold. Is it a wise investment given the U.S. economy is still going strong?


The Glint Mastercard allows cardholders to save, exchange and spend gold in any amount. Economic uncertainty has driven some consumers to invest in gold, but with inflation in check and the U.S. economy still going strong, Glint feels to me like a gamble.

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Credit card companies love to use gold, platinum and other precious metals as marketing terms.

There’s now a debit card that’s actually tied to gold. As in, gold bars held in a Swiss vault. I’m serious – that kind of gold.

The Glint Mastercard allows cardholders to save, exchange and spend gold in any amount. It entered the U.S. market this summer after gaining traction in Europe.

Glint has a lot in common with TomoCredit, the startup I featured two weeks ago that pays credit card rewards in cryptocurrency. Take this passage from Glint’s website, for example:

“Glint delivers a more reliable, independent and ultimately fairer alternative to government-issued paper-money … While we believe that cryptocurrencies share our vision – which is that everyone deserves an equal opportunity to prosper with a secure and reliable form of money – Glint is not a cryptocurrency. It’s better than that.”

Glint’s founder and CEO, Jason Cozens, got my attention when he told me he paid for his breakfast with gold. In touting Glint’s virtues, Cozens focused on how gold holds up better than fiat currencies with respect to inflation. He also stressed that gold is a tangible asset, whereas banks and even governments can fail.

At times, the sales pitch felt dark and more suited for the Great Recession than the current economic climate.

See related:  Poll: Most Americans are still using cash or debit cards to pay for small purchases


Only one (very small) U.S. bank has failed since 2017, and its deposits were FDIC insured. By comparison, back in 2009, 140 FDIC-insured banks shut their doors for good.

But even then, customers didn’t lose any money as long as they stayed within the FDIC’s $250,000 limit per depositor per bank per ownership category. American bank failures are not a significant worry in 2019.

Inflation isn’t top-of-mind in this country, either. The last time the Federal Reserve’s preferred inflation gauge (personal consumption expenditures excluding food and energy) hit 2.5 percent was way back in Q3 2006. The latest reading is 1.5 percent, and the rate has remained in a narrow range between 1.2 and 2.0 percent for the past seven years.

With inflation under control, banks looking stable, unemployment near a 50-year-low and stocks close to record highs, I’m not in a rush to convert my life savings to gold. Still, while I won’t be signing up for Glint anytime soon, I want to be fair and examine its side of the story. There are some aspects of this new service that have potential.

See related:  Consumer credit card debt jumped by $10 billion in July, Fed says

Hedging against uncertainty

There are a lot of worried people these days. Glint is based in the U.K., where the Brexit debate rages on. The U.S. is experiencing its own share of political volatility, of course, and the world’s largest economies are engaged in a protracted trade war.

With so much political and economic uncertainty, some people are drawn to gold as an alternative investment.

Cozens and Glint are fond of noting that the U.S. dollar has lost 86 percent of its purchasing power due to inflation since 1970, while gold’s purchasing power has risen 505 percent in that same span.

However, as I mentioned earlier, inflation has been tame in recent years – it was very high for much of the 1970s and 80s, which skews that statistic.

Currency conversion

There’s also a low-cost foreign exchange angle, which I think could end up being Glint’s biggest winner. It already offers a foreign currency exchange feature to European customers.

The functionality is coming soon to Glint’s U.S. customers. The company’s website states, “Save, exchange, spend and switch between various currencies in your Glint account anywhere at the real exchange rate (multiple currencies are coming soon to the U.S., for now you can exchange between USD and gold).”

See related:  Zerocard: A debit-like credit card for credit-shy consumers

Payments as investments

Similar to how TomoCredit touts that its credit card rewards will become more valuable if cryptocurrencies appreciate, Glint believes gold will grow more valuable over time. Of course, crypto and gold could lose value, too.

While gold has generally performed well as an investment, that has not always been the case. It peaked at $1,895 per ounce in September 2011 (along with worries the U.S. would default on some of its debt).

If you bought then, you’d still be significantly underwater at today’s price of around $1,500 per ounce. If you bought at the start of 2019, on the other hand, you’d be up about 17 percent year-to-date.

I’m intrigued by TomoCredit CEO Kristy Kim’s assertion that many people (especially young adults) desire upside from their credit card rewards. She believes investing rewards in cryptocurrency is the answer.

The more I’ve thought about that, the more I’m on board with the philosophy. It’s essentially gambling with house money.

Shifting cash to gold with Glint, however, is more like gambling with real money. And I’m wary of that.

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