Diamond Standard‘s coin, the world’s only market-traded diamond commodity, is up 30% in the two years since launch, outperforming gold by almost 40% and the S&P 500 by 20%. Last week that commodity’s first spot market was established, providing all investors with liquidity.
Market-Determined Value
Cormac Kinney, the company’s founder and CEO, describes the Diamond Standard commodity:
We made a singular spot commodity, a coin and a bar, where every coin is equal. Inside, the diamonds all add up to a public standard and because they’re all equal they trade at the same price. This enables us to have price discovery, liquidity and an ability to mark it, which is what an investor needs.
Diamond Standard’s coins and bars contain equivalent sets of diamonds encased in resin, traded at a single market-determined value. Each coin and bar is backed by a blockchain token. Kinney notes that, only now, are diamonds being unlocked as an asset. Unlike gold and silver, where investors currently hold 30% and 19%, respectively, only 1% of an estimated $ 1.2 trillion of natural diamonds are held by investors.
IGI Grading
IGI has been engaged in receiving, inspecting, grading and validating the authenticity of natural diamonds acquired through the Diamond Standard Exchange. The institute assembles the diamonds and seals them into transparent coins and bars with a wireless computer chip. Finally, IGI uses Diamond Standard’s specialized equipment to enroll the coins onto a blockchain, creating a regulator-licensed digital token that can be used for transactions. Kinney previously weighed in on the relationship with IGI:
IGI’s expertise, global footprint, flexibility, and long-standing reputation of excellence made them a key partner in our pursuit to develop a regulator-approved diamond commodity. We are excited to begin a long relationship, together delivering a revolutionary new asset to the market.
See Coverage from 2021 on Bloomberg
