CEDEX is a blockchain-based trading platform. As of March 28th 2019, they have secured more than $50 million worth of diamonds, and plan to incorporate blockchain technology with machine learning to turn diamonds into a tradable asset class.
The CEDEX Diamond Exchange-Traded Fund (ETF) Explained
CEDEX will soon be launching a diamond exchange-traded fund (ETF).
Yet prior to the official launch, the platform announced they have already secured more than 6,000 diamonds worth over $50 million.
They claim their platform utilizes blockchain technology and a proprietary machine-learning algorithm to overcome many of the traditional hurdles seen in diamond trading: a lack of transparency, liquidity, and fungibility.
By reducing such problems, CEDEX says its platform will turn diamonds into a tradeable asset class, similar to gold.
The exchange launched a beta version in November 2018 and claims to allow customers to trade in diamonds of different sizes and values with low carrying costs.
According to CEDEX co-founder and CEO Saar Levi,
“The vast inventory available combined with CEDEX unique technology opens up for traditional and digital markets the opportunity to develop financial instruments that will initially create the liquidity needed to jump-start our vision – transforming diamonds into a new asset class.”
Levi went on to describe his vision of how CEDEX could impact the diamond industry:
“Bridging the gap between existing financial markets and the diamond industry will fuel this untapped market from a $90 billion industry to an estimated $300-$400 billion.”
How Different Asset Classes Continue to Enter the Blockchain Realm
Distributed Ledger Technology (DLT) brings significant value to numerous asset classes.
A growing number of asset classes are continuing to implement DLT.
Security tokens represent a large number of these new assets which also feature institutional investors.
Assets such as equity, real estate, investment funds, REITs, and even fine art have all experienced tokenization.
To date, more than $500,000,000 has been invested into the nascent security token industry.
What do you think of a diamond exchange traded fund? Will diamonds become a commonly traded asset thanks to the blockchain? Let us know what you think in the comments section below.
Image courtesy of CEDEX.