The challenges surrounding physical gold trading are multifaceted, including the stringent security measures required for safeguarding tangible gold assets, the inherent dormancy of gold as an investment, the impracticality of using gold in daily transactions in our increasingly fast-paced digital age, and the intricate complexities related to the transportation and transfer of physical gold, especially when dealing with substantial quantities or cross-border movements.

Moreover, existing gold-backed digital currencies, conceptualized as remedies to the limitations of physical gold, have introduced their own set of complications. Usability barriers on many platforms tend to cater predominantly to seasoned crypto enthusiasts, leaving the average user bewildered by complex interfaces and intricate procedures. High minimum thresholds for purchasing and redeeming gold-backed tokens often act as barriers for casual investors or those seeking to diversify their portfolios in smaller portions. The restricted functionality of these digital currencies in everyday transactions, as compared to fiat or mainstream cryptocurrencies, further limits their practicality. Additionally, the opacity and lack of transparency in some digital gold platforms when it comes to verifying the physical gold reserves backing their tokens can foster distrust among potential investors.