Diamond-backed cryptocurrency D1 Coin has just made a USD 20 million diamond purchase through KGK Diamonds via Alrosa, the largest diamond mining company in the world.
This purchase was for 1,500 investment-grade diamonds, bringing the total amount of diamonds in their reserves to 7,500 with a total weight of 4,400 carats (0.88 kg). While shy of a kilogram, these diamond reserves are worth almost USD 40 million, and plans are to expand this to USD 1 billion by the year’s end.
Essentially D1 Coin and its parent company will be a fully functional diamond exchange, and when D1 Coin goes live on cryptocurrency exchanges it hopes to provide an easy avenue to convert Bitcoin into physical diamonds.
D1 Coin joins a cluster of other new cryptocurrency backed by a physical asset, in an attempt to address one of cryptocurrency’s most discussed shortcomings of volatility.
All the diamonds in the D1 Coin reserve have an accompanying certification from the Gemological Institute of America. Every D1 Coin is backed by 1/1000 of a model standard diamond that is 1 carat, F color, excellent cut, and VS1 clarity. So far 3.3 million D1 Coins have been issued and all of them are backed by the diamond reserve which is in a vault and backed by an insurance policy. The diamond reserve is audited by a major firm.
When the D1 Coin redemption service goes live in June 2018 users will be able to select the diamond they want from the reserve, pay with D1 Coins, and then have the diamonds delivered to their home, after which point the D1 Coins involved in the transaction will be burned. Customers in Antwerp and Singapore can skip delivery and personally pick the diamonds up.
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