Expanding Diamond Markets, Harnessing Technology

Diamonds, Where Will The New Markets Be

Somewhere behind the glitter and lavish statement of diamonds is an issue that, worries every diamond seller. The writing on the wall is that diamonds are losing their luster, jewelry buyers seem to be showing lesser interest in diamonds. This is very apparent when you survey the market for matrimonial jewelry. A rising interest in colored gemstones combines with a casual interest in diamonds. The fact is that diamonds need a new market but, they also need some major overhauling of their supply chain. 

The next generation of diamond markets will rely heavily on technology and blockchain seems to be the trend. Before we come down to the technical details for a blockchain, let us address the problems embedded in the present supply chain for the glittering stone. 

A sale of any product would involve a seller on one side and a buyer on the other. The seller would provide details and quote an acceptable price, the buyer would review product details, get clarifications from the seller and work on the price. Negotiations for price might be conducted and the deal could finally be struck. This explanation might seem so very obvious but, you would be surprised if we told you how diamond trade has been conducted for decades and right until today. Looking or hoping for new diamond markets without, reducing or eliminating the inefficiencies and weaknesses in the current diamond trading system will be futile. Blockchains seem to hold promise in improving the conditions under which diamonds are traded. 

Diamond Trade Inefficiencies:

  • There exists a number of brokers and commission agents between the seller and the buyer. 
  • The final buyer never really knows who the original seller was. 
  • The chain of brokers means multiple brokerage fees and commissions. 
  • The final price paid is well above the price quoted by the original seller. 
  • Partial or wrong disclosure of diamonds being offered for sale. 
  • Fake diamonds being wrongly identified as genuine. 
  • Significant Currency conversion expenses and bank fees to settle payments. 

So what is a blockchain, let's keep technical jargon to a minimum while explaining this concept. A blockchain is more like a network of computers (nodes), each node stores the same information as the other nodes. Transaction data that is entered on the blockchain is simultaneously updated on all nodes. Hacking a blockchain is exceedingly difficult, this because the intruder will need to perform the same functions  on all nodes. It is possible for a blockchain expert to make the system flag an error if, the data across all nodes is for any reason not identical. You might hear that the information stored on a blockchain is tamper proof. This is entirely true because, once a piece of information is uploaded on to the blockchain, it can never be deleted or edited. The entire sequence of transactions will be available as a historical audit trail. 

In the new market that is envisaged for diamonds, sellers will be allowed to upload information related to their diamonds on the blockchain. Ideally, the blockchain will be permit only diamonds that have been certified as being authentic. While a number of diamond testing labs offer certification services for diamonds, the blockchain will only accept certificates from a few reputed labs. 

Now with the certified diamonds listed on the blockchain by the seller along with complete description and detail, a buyer could deal directly with the seller. There will be no need for middlemen, which means that the bare price quoted by the seller is what the buyer will need to deal with. In real life, the total commission and profit margins of multiple brokers in a transaction, can add as much as 20% to 30% to the final price of a diamond. With this chunk chopped off, buyers will see a more logical price tag on diamonds listed for sale on the blockchain. This will obviously increase the number of diamond buyers. Confidence in the diamonds listed coupled with the real selling price, has the potential to increase the market for diamonds. 

When it comes to making payment for a diamond purchase, the good news is that blockchain technology has already proved its utility for making peer to peer payments. Crytpo currencies are deployed on secure blockchains. Countries are gradually waking up to the idea that, the world of crypto currencies is bound to grow at an alarming rate. Money could be moved from any part on the globe to another part, transfer charges would be negligible and expensive bank fees can be avoided. 

So let's try to put together an answer to the question 'Where Will The New Diamond Markets Be' mentioned as the title of this report. Considering that the scope for market expansion would be based on technology that is accessible online and at any time of the day or night, it is fair to say that the new market could be located at any point on the planet. The market that we refer to could be scattered and might not be concentrated at a single or few geographical locations. 

The above information is compiled based on the detailed information published at www.glitzkoin.com This project consists of a diamond blockchain and a crypto currency. The team has a healthy mix of diamond experts and tech gurus  in the blockchain technology sector. 

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