Although diamonds have been traded for over 1000 years, it has been done almost exclusively by diamond experts and has been unavailable to the ordinary consumer. This is because the value of a diamond depends on more than just the number of carats. Several other characteristics come into play when valuing a diamond.
However, up till now, there hasn’t been a reliable method to assess the fair value of a diamond without getting it subjectively appraised by a diamond dealer – who may not have your best interests at heart.
In addition, after purchasing a diamond at retail price, it is nearly impossible to later turn around and resell it for its full market value due to a lack of a standardized diamond-reselling platform.
These inefficiencies in liquidity, transparency, and standardization have caused diamonds to be shunned as a traditional asset class, and therefore, the average person has not been able to trade them like other commodities (like your gold jewelry, for example).
Fortunately, with new advancements in financial technology led by CEDEX, this extremely lucrative and stable market has been made accessible to everyone.
We all know diamonds are one of the planet’s precious stones, something that stands for opulence, elegance and prosperity. Although this is all true, it’s perhaps this untouchable view of diamonds that has forced most of us to put it on a pedestal as something that we only get involved with once or twice in a lifetime on special occasions, if at all.
But instead of being put on display just to be admired, diamonds can now be leveraged by the everyday consumer for financial gain. Apart from the fact that the industry has a USD $80 billion annual market turnover, there’s the hidden potential within the industry that’s more astounding.
Diamonds have been increasing in value every year by an average rate of 15% since the late 1950s, and this trend shows no signs of stopping. As the demand for diamonds continues to grow, the supply remains quite limited. In fact, within the next 30 years, it is estimated that there will be a diamond supply shortfall of approximately 278 million carats (over $40 billion).
This substantial increase in demand will cause the market value of diamonds to rise significantly. It is no wonder why diamonds are thought to be much more stable and less volatile investments than other precious metals, such as gold.
Last but not least, the diamond-trading market functions independently from other financial markets. It’s therefore a great revenue stream to fall back on in a weak economy, as its growth seems largely unaffected by the rest of the market (e.g. diamond value continued to increase during the 2008 US economic crisis).
With all that in mind, it’s easy to see the tremendous value in this once secluded market. Luckily, thanks to CEDEX, this lucrative industry is now within reach for all interested consumers.
What is CEDEX?
CEDEX is the first ever certified blockchain-based diamond exchange. In other words, it is a platform powered by Blockchain technology that allows anyone to trade diamonds as if they were any other type of asset. This is all possible through the use of a machine learning (artificial intelligence) algorithm, called the DEX, which gathers market data as well as specifications of each diamond in order to generate a fair market value.
Best of all, since DEX is powered by Blockchain technology, this process is both completely transparent and standardized, solving the major issues that have prevented ordinary buyers and sellers from entering the diamond market in the past. In addition to transparency and standardization, the platform brings together buyers and sellers – cutting out the middleman and creating the ability to easily liquidate a diamond at a fair price.
In other words, gone are the days of being at the mercy of diamond dealers and pawn shops and losing 30-50% of the fair market value when trying to resell (test out the alpha version DEX and see how much your diamond is worth today). So, if you are wondering how an average person with no expert knowledge of diamonds can prudently start trading without having to rely on (and pay for) outside professional advice – the answer is DEX.
With the help of this proprietary technology, the diamond-trading process is now easier than ever.
How Can You Get Started?
To start trading, the first step you must take is to purchase CEDEX Coin, the digital currency used to pay for everything on the CEDEX exchange (e.g. transactions, insurance, delivery, custodian fees). The CEDEX Coin will be a part of all major cryptocurrency exchanges, so it will be easily transferable to Bitcoin, Ethereum (ETH), fiat currencies, or other cryptocurrencies.
During the initial 10-day pre-sale of these coins (beginning March 16, 2018, at 19:00 GMT) and subsequent main-sale, only ETH will be accepted as payment. However, after the initial coin offering when CEDEX Coin becomes part of the crypto exchanges, Bitcoin, Bitcoin Cash, and fiat currencies will be accepted as well.
Another point worth noting is that during the pre-sale, generous, early-bird incentives will give buyers 0.3 bonus coins for every 1 CEDEX Coin purchased. For those who have not yet entered the world of cryptocurrencies, this may all feel a little bit intimidating – but it is truly not as complicated as it may seem. Learning the basics to get started should take no more than a couple of hours.
Essentially, you just need to choose a crypto exchange site such as bitfinex.com, bittrex.com, or polononiex.com (see the complete list of exchanges). From there, follow the straightforward tutorials found on their site showing how to easily exchange fiat (or other types of cryptocurrency) for Ether.
From there you are all set to register for and purchase the CEDEX Coin. And once you have your CEDEX Coins, the exciting world of buying and selling diamonds awaits.
How to Buy and Sell Diamonds
Now to the fun part – buying or selling your first diamond. The diamond-trading process revolves around a system of diamond tokenization (i.e. creation of Diamond-Smart Contracts). If you have a diamond that you wish to trade or liquidate, all you need to do is to list it on CEDEX using a simple process that involves entering the Diamond GIA Certificate Number and carat size.
The diamond will then be shipped to the custodian for validation, and once verified, a Diamond-Smart Contract is generated. The market value of the smart contract will be rated by DEX and given a rank, and then this rank can be used by anyone on the platform (even those with no expertise in trading diamonds) to make sound purchasing decisions.
Creating smart contracts and trading them within the CEDEX ecosystem offers many distinct advantages:
- Eliminates additional transportation and insurance costs.
- Avoids fiat-currency transaction charges.
- Allows fast and efficient P2P trades – removing the need for third-party involvement.
- Smart Contracts utilize open blockchain technology that offers users complete transparency and access to all data including diamond origin, transaction history, gemological data, etc.
Lastly, you might be thinking, “This all sounds very interesting, but I don’t have the money to start trading with expensive diamonds.”
The good news is there are actually three different ways to invest in diamonds, offering everyone an opportunity to get in on the action:
- Invest in a single diamond
- Invest as a part-owner in high-value diamonds
- Invest in a “diamond basket” (ETF fund – similar to trading stocks or other traditional types of investments)
So, if buying individual diamonds is not right for you at the moment, there are shared options as well, which can be just as profitable.
For many years, the diamond-trading industry has been reserved for diamond experts and been mostly off-limits to the general public. This was mainly due to a lack of transparency within the industry, prohibiting non-experts from obtaining the true fair market value of individual stones.
And even if the true market value was known, you were highly unlikely to find someone that would actually buy or sell it at that price.
However, those days are over. CEDEX has removed the barriers to entry by creating a more liquid marketplace for both the demand and supply side of the diamond trading industry. In doing so they’ve opened up the field to a wider consumer base by developing an innovative and easy-to-use platform.
Not only does the CEDEX platform connect the supply and demand chains, eliminating the need for a greedy middleman and allowing users to trade with each other directly, it also provides transparency and standardization.
Using the platform, you will always know exactly what the current market value is for each diamond (no more subjective appraisals), and how it compares to other diamonds in its class.
It is an exciting new era for individuals interested in entering the attractive world of diamond-trading. There has never been a better time to start.