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Tokenizing Diamonds Implemented by Two Diamond Juggernauts

Tracking and transparency. These are among the two benefits that make blockchain so popular to businesses, particularly those that are concerned with monitoring a product going from point A to point B.

The diamond industry is among these sectors since they want to earn the trust of consumers that they’re mined diamond isn’t coming from war-ravaged regions. But tracking isn’t the only advantage of blockchain that the market wants to exploit.

In a recent maneuver, two of the leading diamond giants have made a deal with blockchain startup D1 Mint Limited, creator of the diamond-backed digital currency D1 Coin. The partnership is aimed at tokenizing diamonds, transforming the asset into an investment class that will hopefully draw in more investors from different sectors.

D1 Limited employs a pricing system to distinguish the value of an investor’s token that can be used to redeem diamonds from the company’s reserve at any given time. A diamond’s value is measured using multiple factors such as clarity, cut, shape, and carat. D1’s algorithm is designed to estimate these factors to determine exactly the worth of the diamond-backed tokens.

But wealthy businessmen and other companies aren’t too keen to invest in the diamond market since the industry has seen stagnating numbers in the last four years. Among the reason for this is the above-mentioned decrease public confidence regarding diamonds as it may come from war-torn areas where profit gained is used to fuel the fighting.

To alleviate consumer doubts, blockchain is being adopted in several diamond companies. Global diamond juggernaut De Beers has successfully used the technology to monitor the shipping of 100 diamonds from mine all the way to the retailer.

Another technological advancement that blockchain produced is the development of the crypto anchor verifier. The verifier is going to be a smartphone application where it takes advantage of a phone’s camera to authenticate whether or not a certain product is fake or real. The only additional augmentation is a specialized lens to be placed over the phone’s camera to enhance its capabilities.

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