Israel Diamond Exchange Supporting Digital Currency Based on Diamonds
The Israel Diamond Exchange (IDE) has signed an agreement with a start-up named CARATS.IO to launch a digital currency backed by diamonds named CDC – CARATS.IO Diamond Currency.
The IDE said its support for the venture was a way of boosting trade within the bourse.
CARATS.IO specializes in Big Data solutions for precious gems and diamonds, the IDE said in a statement.
The digital currency will be based on investments in diamonds bought at the Israeli exchange. Trading currency will be based on an index that reflects activity within the Israeli diamond center.
IDE President Yoram Dvash said, “For the past several years there have been many attempts to turn diamonds into a viable financial instrument, but none has succeeded. We believe in order to achieve this it is essential to bring in parties from outside the diamond world, as part of the Innovation Center which we have established in the Israel Diamond Exchange. Bringing new investors to the diamond sector in Israel is important for the local industry and for the country. We intend to make use of the incredible expertise that Israel’s high tech industry offers.”
CARATS.IO stated: “The diamond industry can be an attractive investment channel for the many investors in digital currencies. This currency is unique as it will be backed by investments in diamonds, which have steadily appreciated over time. There is a large community of investors in digital currencies throughout the world. By backing this currency with diamonds we are significantly decreasing the speculative level of the investment. Our cooperation with the Israel Diamond Exchange is an important step in making this currency a reality.”
Digital currencies have become attractive investment channels in recent years, the IDE said. The Financial Times reported last week that a group of leading banks, including Credit Suisse, Barclays, HSBC and others, have joined together to launch a new form of digital cash for clearing and settling financial transactions in 2018. With the rising popularity of digital currencies, IDE and CARAT.IO believe that the diamond backed currency will be an attractive option for investors outside of the diamond world who are seeking new avenues for digital investments.