- November 5, 2018
- Posted by: Mor Hazen
- Category: carats blog posts
The newly-launched diamond-backed token has unlocked the world’s most concentrated store of wealth, creating perhaps the most accessible and practical commodity to invest in
Remember that rumour spreading around the web in 2012 after Apple sued Samsung? An article claimed that the Samsung executives, furious at losing the court case, decided to pay the American digital giant their $1 billion fine in nickels. The article described a caravan of over 30 trucks filled with coins being driven over to the Apple headquarters. While this story has since been debunked, it has still remained a hilarious reminder for us – putting in perspective the incredible amount of capital being transferred between investors and companies in this day and age. We are so accustomed to transferring large sums digitally, that we easily forget how much (or, how heavy) that money would be if we actually held it in our hands.
However, investors delving into the exciting and lucrative world of commodities have no such luxury. While it is relatively simple to invest from afar in gold, wheat and oil options, actual ownership of such commodities is complex, expensive and not truly accessible for most. After all, what would you do with 50 pounds of gold? Bury it in your backyard? As investors don’t really want to own the said resource, they instead buy up options or make market investments. These may be lucrative, but essentially, they are investments that are not fully backed by the physical commodity and, as such, will always maintain an element of instability.
Diamonds are different. Diamonds, the small, shiny rocks, have been proven to be the most concentrated store of wealth. You can hold, carry and wear these commodities with ease, meaning that even large investments can be realistically transferred and stored at home. As such, these shiny gems have traditionally been reliable investments and stores of capital for the wealthy.
However, the diamond market has traditionally been a closed club for only a select few. The industry was nearly impossible to standardize, meaning each exchange of diamonds was a complex, expensive and tedious process. Thus, even though these gems were such promising investments, most of the public couldn’t truly access them themselves.
Until now, that is. By linking each diamond to a digital token (as well as developing a standardized pricing mechanism), Carats.io is opening up the possibility of a global financial market for diamonds, and fully commoditizing these shiny rocks. Investors can purchase CARAT tokens and actually own their own diamonds. As alluded to before, this is an improvement on the current commodity investment models. At any time, CARAT holders can redeem their cryptocurrencies for the actual stones – stones they can carry in their pockets back home (or even place on a ring to give to their loved ones). In this way investors can enjoy the rewards and profits of investing in the commodity market, while still ensuring the stability and reliability that only true ownership can provide.
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