The Future of Exploration: Tokenising Pounds in the Ground

A reader recently introduced me to an interesting idea: a firm in the US is looking to ‘tokenise’ unmined gold resources.

Here’s the pitch from the company ‘NatGold’, which is looking to kickstart the idea (emphasis added):

Globally, an estimated $5+ trillion in verified gold reserves remain locked underground—not because they lack value, but because the model that once funded discovery is dead.

And that’s just the known gold reserves, with untold trillions more in unaccounted-for gold resources.

The junior mining sector—once the speculative engine of the gold industry—has lost its fuel. Permitting is a brick wall. Capital has moved on.

And promising projects are turning into stranded assets before they ever get a chance to deliver.

And this:

You make a discovery. You publish a technical report. But then come the real challenges: permitting delays, environmental resistance, protests and legal battles from indigenous populations over land and mineral rights, soaring costs, shrinking capital, relentless dilution.

Even for those who succeed, the value often arrives too late—or at too high a cost.

For most? The path ends before it ever truly begins.

That’s why we created NatGold. It’s not a theory. It’s a rigorously structured model—built with legal, engineering, and blockchain-grade security at every layer.

Mining Memo’s Take

First of all, I have no affiliation with this US outfit.

I just thought their pitch was interesting as it reflects the common catch-cry from the junior mining sector:

‘The model that once funded discovery is dead.’

In other words, despite record gold prices and producers’ share prices reaching all-time highs, junior gold stocks aren’t feeling the love.

Much of this sector remains rangebound, near-record all-time lows.

Despite bullish conditions in the precious metals market, gold juniors aren’t gaining traction or investor interest.

That’s effectively starving them of the capital needed to continue exploration efforts or develop new deposits.

And if they can’t attract attention at record gold prices, when will they ever gain the attention of investors?

So, here’s the thing…

With its tokenising strategy, Natgold is perhaps filling the long-lost void for the junior mining sector.

Pioneering a new funding model outside the traditional stock market.

Many in the industry have blamed the lack of interest in junior mining stocks on the overwhelming focus on new-age investment themes like crypto, meta, and AI.

According to them, the tech sector has sucked speculative capital AWAY from the junior mining sector.

That’s why they claim junior mining faces a ‘broken funding model’ made worse by the difficulties in gaining permitting to explore and develop new mines.

But NatGold has perhaps hit on something important here…

It’s finding common ground between crypto speculators and explorers desperately needing capital!

Restoring the long-lost bond!

And that’s why this idea is worth watching… A very real source of significant capital injection for the exploration market.

So, how could it work?

It’s not as simple as it might sound when discussing unmined gold ‘sitting in the ground.’

These resources fall into different categories depending on geologists’ confidence in the models used to measure that gold.

In exploration and resource estimation, confidence is built on the number of drill holes.

For example, imagine an early discovery made by an exploration company:

There might be five or six drill holes spaced over two or three hundred metres, leaving many gaps in the geological model or estimation of how much gold is there.

So, at this early stage, geologists tend to ‘join the dots,’ i.e. sketching in the gold from one drill hole to the next.

That obviously entails huge assumptions. A drill hole might be 5-10cm wide.

A minute snippet of information. A microcosm of data amongst a universe of unknowns!

Gold deposits rarely ‘drift’ evenly from one area to the next.

Nature is inherently unpredictable. Faults, pinching or swelling, shear zones, or any number of geological ‘disruptions’ could severely test the assumption of how much gold actually sits below the ground.

It all boils down to this….

More drilling means fewer gaps.

Fewer gaps mean fewer ‘guesses.’

It’s all very arbitrary. The industry has designed standards, like the JORC code in Australia, categorising a deposit as either inferred, indicated, or measured.

That way, investors can at least gain some confidence in the accuracy of the company’s estimate of the number of ounces reported.

But even then, it’s still very loose.

To the chagrin of financial analysts, who like calculating a company’s future performance based on neat metrics… No deposit is the same.

You can’t neatly categorise resources into three measurable ‘types.’

Exploration is inherently unpredictable. No deposit is alike.

Even with extensive drilling, there’s no guarantee that what geologists have ‘measured’ in their models will reflect the reality once mining occurs.

Typically, a portion of that gold is lost during extraction and processing.

Gold, especially, is inherently unpredictable.

But back to the tokenising…
Is there an investment angle?

There could be. But more importantly, it introduces explorers to the crypto crowd. And that’s perhaps the key thing here.

Potentially more capital and additional routes to fund exploration.

However, for investors, ‘tokenising’ won’t make much difference.

You still need to know WHAT you’re buying.

And as I’ve explained, geology is the only way you will achieve that in the junior mining sector.

I’ve worked in gold exploration and many other minerals for several years and know the inherent difficulties explorers face.

So, if you want an exploration geologist’s take on which exploration stocks to buy, you can check out my latest work here.

Until next time.