Digix aims at the tokenisation and documentation of physical assets, in this case gold, through its proof of asset protocol (which basically determines who owns what), which allows for the open and public verification of an asset's existence without a centralized database. A decentralized database is highly desirable owing to the limitations of a centralized database.
There are two tokens associated with Digix, DGX and DGD.
Both run on the Ethereum network.
The value of a DGX token is equivalent to a gram of gold. The gold is stored in a Custodian Vault, The Safe House, in Singapore. It is possible to recast and redeem your DGX back into gold through DigixGlobal.
DigixDAO is a software protocol fully on chain, fully decentralized and autonomous, created by DigixGlobal for decentralized governance.
DigixDAO created and issued DGD tokens in the first major Ethereum crowdsale, and their total supply as at now is fixed at 2,000,000 DGD.
When you own DGD tokens, you have voting and ownership rights in DigixGlobal, which means you get to vote for/or against proposals in DigixGlobal.
Since there is a transaction and storage fee for using and holding the DGX token, these fees are distributed to DGD holders.
If you own DGD (and participate in governance) you will collect these fees which are distributed quarterly, that is once every three months.
The DGX token is backed by gold. Since the company (DigixGlobal) that issues these tokens needs to make decisions, they've created DigixDAO (for decentralized governance) which issued DGD tokens, and the holders of these (DGD) tokens make decisions in the company, and earn transaction and storage fees in DGX as a reward for the governance and helping the efforts of DigixGlobal.
