In our previous article we started looking at the diamond industry’s many moving parts and how they interact with each other and potentially with CEDEX.
In this article we will take a closer look at the money and technology behind this massive money-making industry and what it all means for people that want to have a better understanding of it.
Chapter 2 – The Finance And Technology
The number 1 thing that one should know about the diamond industry is that despite being closed off to public eyes for centuries there is probably no international grand scheme between various parts of the industry, there’s just a desire to protect data, practices and other items of interest.
So it’s not like a rough diamond supplier just magically makes diamonds appear in the arms of a waiting polishing company and so on – they are suppliers and purchasers like any other business.
This image may help you understand how the parties exchange items:
So manufacturers and suppliers transfer the supplies via intermediaries to wholesalers and retail shops and receive their payment in return, and the same thing happens for other links in the chain of supply.
What we think of as “the diamond industry” is actually a much more intricate system than we believe.
For example – before the diamonds even make it to sellers they have to be transformed from rough to polished, a process that requires expert hands and eyes, in the previous article we covered the “where” of this process, but as for the “how”, well, there are two major players in the field of technologies that aid in diamond polishing:
Sarin labs have developed many of the machines used the world over in the cutting process, and Belgium saw fit to attempt to go their own way, likely thinking that seeing how as they are already a worldwide hub – they would be wise to avoid paying an outside firm like Sarin to use their technology when they have their own ability to do so.
So they did.
But what happens to the diamond before we actually get to see them up close as part of a ring, necklace or as some part of an impressive jewelry collection?
Well, they would first need to be examined with expert eyes, graded and granted a certificate of authenticity that holds all the relevant data about them, to that end, there are a few large labs that handle this type of work and here they are:
GIA are considered the largest and best recognized name in the field and a GIA certificate is as good as a bond in the diamond world, which is also why CEDEX chose to partner with them.
But just like any other industry, there’s one factor above all the others that determines the fates of many – Money.
And in a multi-billion dollar industry like diamonds, there are quite a few players that help facilitate transfers from between suppliers and aid those in need of cash flow.
These are exchanges and networks for jewelry and diamond dealers, and you may know a name that appears on the following list:
Yes, this is a part of where CEDEX would come in – as an integral link in the finance chain – as it would essentially be a service that helps connect sellers and potential customers – but on a global scale – as opposed to an industry scale.
CEDEX will act as a go-between for manufacturers and suppliers and provide them access to a world full of potential customers who in this case will more than likely be cryptocurrency holders.
On the other side of the coin CEDEX can also aid cryptocurrency holders that simply wish to liquidate their highly volatile assets in times of trouble instead of having them fade away into nothing.
So there you have it, a little insight into how an age old industry works and how CEDEX comes in to help it change and become a little more modern.
In our next article we will look at the actual diamonds themselves – how they are formed and how humans usually get their hands on them.