Gold has been cherished as a precious metal since the early days of human civilization. Over the centuries, it has evolved from being used in decorative objects and jewelry to becoming a medium of exchange for global trade. Today, gold serves various purposes, including electronics and as a hedge against inflation. However, to ensure its value remains consistent, gold must be refined to achieve the highest levels of purity. In this article, we will explore the different refining processes involved in refining gold.
Why Does Gold Need To Be Refined?
It may come as a surprise to many that gold, when mined from the ground, contains impurities. According to the World Gold Council, extracted gold ore is typically only 60% to 90% pure. However, for applications like medical devices, electronics, and savvy investors, gold must have a purity level of 99.99%, equivalent to 24-karat gold. The reasons for refining gold include removing natural impurities, creating gold alloys, meeting specific end-use requirements, creating a consistent store of value, and recycling for reuse. Depending on the refining process, different levels of purity can be achieved. For example, 22-karat gold, with a purity level of approximately 91.7%, is preferred for jewelry due to its durability and workability.
Gold Refining Processes
Gold refining involves the removal of impurities to achieve the desired level of purity for various applications. Different refining options are available based on the specific needs of the application, with some processes being more precise than others.
Fire assay, also known as cupellation, is a traditional method of measuring or testing the purity level of gold or silver samples. It is not technically a refining process but serves as a way to determine purity. During fire assay, the sample is melted in a furnace, and the resulting molten ore is poured into a cupel. The cupel, a small, porous cup, absorbs impurities, leaving behind a bead of gold that can be weighed. By comparing the weight of the bead to the original weight of the sample, its purity can be determined.
The Miller Process, named after its inventor Francis Bowyer Miller, can refine gold up to a purity level of 99.5%. It is suitable for refining large volumes of gold and involves several complex steps. The process begins by melting the gold into doré bars, which are bricks of gold created at the mine site. The doré bar is then exposed to chlorine gas, which binds the impurities to the gold, separating them. The remaining liquid condenses into a purer form of gold suitable for bullion, electrical components, and various other uses.
Aqua regia, meaning "royal water" in Latin, is a gold refining process that uses highly corrosive chemicals to achieve purity levels of 99.99%. The process involves a specific ratio of nitric acid (HNO3) and hydrochloric acid (HCl). Due to the toxicity of the chemicals involved, strict safety precautions must be followed when using this process. Aqua regia is often used in laboratory applications to prepare samples.
The Wohlwill process is known for producing the highest purity levels, reaching up to 99.999% pure gold. The early stages of this process are similar to the Miller process, where gold bars are melted. An aqua regia solution is used to dissolve the bar, followed by an electrical process called electrolysis. Electrolysis migrates impurities to an anode, leaving behind purer gold in the cathode. The gold in the cathode is further processed to achieve even higher purity levels. While the Wohlwill process is not as commonly used as other techniques, it is preferred when the highest levels of purity are required.
Carbon absorption is a refining technique that is not limited to precious metals but also used for purifying gases, liquids, and solutions. It involves absorbing carbon molecules onto an activated carbon surface. Before carbon absorption, the gold is put in contact with a cyanide solution. The gold-cyanide solution bonds to the carbon and is then transferred to a tank, where another solution strips the gold from the carbon. Carbon absorption is particularly efficient when dealing with complex solutions and can be adapted to various refining environments.
Market and Industrial Applications of Refined Gold
In addition to its monetary value, gold finds extensive use in various industries due to its unique characteristics. Its resistance to rust, tarnish, and corrosion, as well as its excellent conductivity, make it an ideal choice for different applications.
Jewelry is one of the most well-known uses for refined gold. Its malleability, ductility, and inherent beauty make it the preferred metal for crafting intricate and durable jewelry pieces. Gold jewelry pieces that come in direct contact with the skin, such as bracelets and earrings, are popular due to gold's biocompatibility, reducing the likelihood of allergies or skin reactions.
Gold is widely used in the electronics industry and can be found in computers, smartphones, circuit boards, telecommunications equipment, medical devices, aerospace electronics, audio equipment, and automotive equipment. Its conductivity and corrosion resistance make it an excellent choice for electronic devices. Gold is also commonly used for thin film deposition, wiring, and plating in electronic applications.
Investment and Bullion
Gold is often purchased in bullion form as an investment and hedge against inflation. It serves as a store of value on a global scale and provides a sense of security for those seeking assets with legitimate value. With an estimated 77% of the world's gold already mined, the precious metal is expected to become even scarcer and more valuable over time.
Gold refining is a crucial process to achieve the desired purity levels for various applications. From jewelry manufacturing to electronics and investment purposes, refined gold plays a significant role in different industries. With its unique properties and limited supply, gold continues to be a sought-after asset. If you are interested in investing in gold or adding it to your portfolio, contact Learn About Gold today.
Frequently Asked Questions
What does a gold IRA look like?
You can purchase physical gold bullion coins anytime. You don't have a retirement date to invest in gold.
The beauty of owning gold as an IRA is you can hold on to it forever. Your gold assets will not be subjected tax upon your death.
Your heirs can inherit your gold and avoid capital gains taxes. Because your gold doesn't belong to the estate, it's not necessary to include it on your final estate plan.
To open a IRA for gold, you must first create an individual retirement plan (IRA). Once you've completed this step, an IRA administrator will be appointed to your account. This company acts as an intermediary between you and IRS.
Your gold IRA custodian can handle all paperwork and submit necessary forms to IRS. This includes filing annual reports.
After you have established your gold IRA you will be able purchase gold bullion coin. The minimum deposit required to purchase gold bullion coins is $1,000 However, you'll receive a higher interest rate if you put in more.
Taxes will be charged on gold you have withdrawn from an IRA. If you take out the whole amount, you'll be subject to income taxes as well as a 10 percent penalty.
A small percentage may mean that you don't have to pay taxes. There are exceptions. If you take out 30% of your total IRA assets or more, you will owe federal income taxes and a 20 percent penalty.
You should avoid taking out more than 50% of your total IRA assets yearly. You could end up with severe financial consequences.
How much gold can you keep in your portfolio
The amount of capital that you require will determine how much money you can make. You can start small by investing $5k-10k. Then as you grow, you could move into an office space and rent out desks, etc. Renting out desks and other equipment is a great way to save money on rent. Rent is only paid per month.
It's also important to determine what type business you'll run. In my case, I run a website-creation company. Our clients pay us between $1000-2000/month and depending on their order. Consider how much you expect to make from each client, if you decide to do this kinda thing.
Because freelance work pays freelancers, you won't likely get a monthly income if you do freelance work. You may get paid just once every 6 months.
So you need to decide what kind of income you want to generate before you know how much gold you will need.
I suggest starting with $1k-2k gold and building from there.
Is it a good idea to open a Precious Metal IRA
You should be aware that precious metals cannot be covered by insurance. There is no way to recover money that you have invested in precious metals. All your investments can be lost due to theft, fire or flood.
This type of loss can be avoided by investing in physical silver and gold coins. These coins have been around for thousands and represent a real asset that can never be lost. These items are worth more today than they were when first produced.
Choose a reputable company with competitive rates and quality products if you are looking to open an IRA. You should also consider using a third party custodian to protect your assets and give you access at any time.
If you decide to open an account, remember that you won't see any returns until after you retire. So, don't forget about the future!
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (aarp.org)
- If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (forbes.com)
- You can only purchase gold bars at least 99.5% purity. (forbes.com)
- 7 U.S. Code SS7 – Designation Boards of Trade as Contract Markets
- 26 U.S. Code SS 408 – Individual retirement account
The History of Gold as an Asset
From the beginning of history, gold was a popular currency. It was universally accepted and loved for its beauty, durability, purity and divisibility. Aside from its inherent value, it could be traded internationally. There was no international standard for measuring gold at that time, so different weights and measures were used around the world. For example, in England, one pound sterling was equal to 24 carats of silver; in France, one livre tournois was equal to 25 carats of gold; in Germany, one mark was equal to 28 carats of gold; etc.
The United States began issuing American coin made up 90% copper, 10% zinc and 0.942 fine-gold in the 1860s. This resulted in a decline of foreign currency demand and an increase in the price. This was when the United States started minting large quantities of gold coins. The result? Gold prices began to fall. The U.S. government was unable to pay its debts due to too much money being in circulation. To do this, they decided that some of their excess gold would be sold back to Europe.
Many European countries began accepting gold in exchange for the dollar because they did not trust it. After World War I, however, many European countries started using paper money to replace gold. The price of gold rose significantly over the years. Even though the price of gold fluctuates, it remains one the best investments you can make.
By: Learn About Gold
Title: How Is Gold Refined? A Comprehensive Guide
Sourced From: learnaboutgold.com/blog/how-is-gold-refined/
Published Date: Thu, 14 Dec 2023 20:04:14 +0000