The Israel Diamond Exchange (IDE) has signed an agreement with start-up CARATS.IO to launch a digital currency backed by diamonds named CDC – CARATS.IO Diamond Currency.
The start-up specializes in Big Data solutions for the precious gems and diamond industries, the IDE said in a statement.
The new digital currency will be based solely on investments in diamonds purchased at the Israel Diamond Exchange. Trading in the currency will be based on an index that reflects activity within the Israeli diamond industry. The IDE has chosen to support this venture as a way of boosting trade within the bourse.
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.”