Diamonds are famously unique, which in the past has limited their appeal as commodities. But that may be starting to change as new technology takes hold. A firm operating in the space says it is pushing further toward transforming the investment story around diamonds.
Diamond Standard, which has developed a “diamond commodity” investment offering, this week said it has closed a $30 million investment round.
The round was led by Left Lane Capital and Horizon Kinetics. Additional participants in the round include Gaingels and Republic.co.
The fundraising program came after the group launched the Diamond Standard Fund, enabling investors to allocate to diamonds through shares, rather than holding physical diamonds directly. In the past, the specific qualities of diamonds – every one of them is different – has tended to make it hard to treat them as an homogenous asset class, such as gold. Diamond Standard is using technology from the cryptocurrency and blockchain space to drive development (see an interview here).
In September 2021, the firm announced that it had new headquarters on Fifth Avenue, New York – overlooking the city’s diamond district and near the Gemological Institute of America. Last year it also announced that agreements were in place to develop diamond futures offered by MGEX™ via the CME Globex® platform, and options via MIAX™.
Diamond Standard said that globally, the diamond sector is worth $1.2 trillion – more than all the world’s silver and platinum combined.
“Following 20 per cent returns last year, the Diamond Standard Coin has continued to generate a positive return this year, while the S&P 500 is down 14 per cent and bitcoin is down 50 per cent. Investors need a new uncorrelated asset class, and this capital will enable us to increase capacity and expand our offerings,” Cormac Kinney, founder and CEO of Diamond Standard, said.