The Far East Development Fund, which is full owned by Russian state development Vnesheconombank (VEB), has partnered with Singapore-based Diamundi to launch of a new cryptocurrency, the ‘D1 Coin,’ backed by Siberian diamonds.
Diamonds are a traditionally illiquid asset class, but their tokenization means that anyone will be able to buy, own and sell a fractional value of a diamond.
“Being backed by the intrinsic value of a physical asset, the price of D1 Coins will generally be more stable than that of other cryptoassets. Thus, D1 Coins are a more secure store of value and reliable medium for transactions,” claimed the fund in earlier statements.
Starting from this month, digital asset investors will be able to buy these diamond-backed tokens in an open pre-sale. Further on, the Russian fund plans to have the token listed on such cryptocurrency exchanges such as Bitfinex, Bitstamp, bitFlyer, KCOIN and others. An agreement with Russian exchange Voskhod was inked in September 2017.
Tokenizing Siberia’s wealth
The diamonds used to back D1 Coins are “sourced from world class producers such as [Russia’s] Alrosa,” “certified by the Gemological Institute of America (GIA),” and “stored by a custodian in secured vaults in Singapore and Switzerland,” says the Russian fund.
After tokenizing diamonds, the fund intends to leverage other types of assets, from gold to gas: “We think we have several trillion dollars’ worth of valuables in Russia’s Far East,” said Alexei Chekunkov, chief executive of the Far East Development Fund, in an exchange with The Financial Times last week.
Thus the fund is acting “as an integrator between Russian and international companies.” It aims to “use the Blockchain technology to attract investment to traditional industries through the cooperation between manufacturers and advanced fintech developers,” reports Russian online publication Firrma.ru.
Small bugs and early competitors
While the value of Siberian diamonds is beyond any doubt, and their tokenization may arguably have a strong potential, the D1 Coin open pre-sale does not seem to have been perfectly prepared. On the website, the whitepaper is not easy or impossible to download, while information about the date of the open presale and about the minimum subscription amount ($1000 on the D1 Coins site, $10 according to the Financial Times interview) is unclear or contradictory.
The idea of tokenizing diamonds is not new. Cedex, which presents itself as a “certified Blockchain-based diamond exchange,” has opened its token sale and plans to launch its platform in the fall of this year. Carats.io has made an alliance with the Israel Diamond Exchange and plans to launch an ICO this year to “put the diamond world in the next generation of crypto tokens.”
Gold-backed cryptocurrencies are also emerging. One of them was launched earlier this year by Goldmint.io, a company with Russian roots operating internationally after raising some $6 million in an ICO in late 2017.
See the full scoop over at East-West Digital News: https://ctrlshift.co/2018/05/12/russian-state-backed-fund-to-tokenize-siberian-diamond-gold-and-gas/