Israel Diamond Exchange announces diamond-based cryptocurrencies

The Israel Diamond Exchange (IDE) will unveil two new diamond-based cryptocurrencies at the next 2018 International Diamond Week in Israel (IDWI)

Created by startup Carats.Io, the group will host a seminar introducing its new diamond-backed financial instruments and explain the benefits it could have for the diamond industry.

Carats.Io will be creating two separate cryptocurrencies, each backed by diamonds purchased on the Israel Diamond Exchange. One coin called CUT (Carat Utility Token), will be used specifically in B2B transactions between eligible diamond traders, enabling safe peer-to-peer transactions.

The second currency, called ‘CARAT’, is meant for the wider market of financial institutions and digital currency investors. Both currencies will be backed by diamonds with a market cap coverage of 25%, significantly reducing the speculative level of investment.

Avishai Shoushan, founder and CEO, said: “We’re making a meaningful contribution to the diamond industry by simplifying transactions between diamantaires, eliminating financial intermediaries, and enabling diamond dealers to hedge themselves against price changes.

“Moreover, we’re opening the diamond industry to a huge, largely untapped market of financial institutions and cryptocurrency investors.”

Yoram Dvash, IDE president, said: “By cooperating with this innovative startup, we’re making diamonds a viable investment channel for a whole new market. This is important for the diamond sector in Israel and the world over.

“Israel’s high tech know-how is a huge resource for our industry and we’re proud to play a pivotal role in heralding the next era of diamond trading.”