Singapore Diamond Investment Exchange Pte Ltd (SdiX), which describes itself as the world’s first commodities exchange in physically settled diamonds, has announced, in a statement released yesterday, that it will begin ‘live’ functioning in September this year. SdiX is backed by Vertex Ventures Holdings, a fully-owned venture capital subsidiary of Temasek Holdings, and the second largest shareholder of SdiX.

The company said that it aims to create a new global marketplace for fair, orderly and transparent trading of diamonds. The exchange is designed to deliver price transparency and liquidity to the diamond market through a real-time price discovery mechanism, which will enable diamonds to be traded as a commodity, and help in the creation of a new asset class.

SDiX is a fully electronic spot commodity exchange and its cutting-edge technology and trading engine allows matching trades above 500,000 transactions per second. The market price of the stones is driven by real time transactional data.

Diamond supply will initially be provided by key members of the Bharat Diamond Bourse, the world’s largest diamond market. All diamonds listed on the SDiX will be graded by GIA.

SDiX will start with two dedicated physical vaults, one operated by Malca-Amit in Singapore Le Freeport and second operated by Malca-Amit within the Bharat Diamond Bourse, Mumbai.

There are 25 Pioneer Members for the launch, comprising Approved Suppliers and Broker Members. They include Paragon Diamonds, Kiran Gems Pvt. Ltd., SRK, Hari Krishna Exports Pvt. Ltd., Rosy Blue, Sheetal Group, Leo Schachter Diamonds, KP Sanghvi, Kapu Gems and UOB Kay Hian, representing participation across six countries: Singapore, India, Hong Kong, US, Belgium, and UK. More members may be added by the time the exchange goes live.

Alain Vandenborre, Executive Chairman and controlling shareholder, said: “SDiX is a fully electronic spot commodity exchange which we developed over the past two years. We aim to provide a fair, orderly and transparent global marketplace in which diamonds may be acquired at real-time transactional, wholesale prices, thereby removing the need to go through private traders who have little or no regulation. With our innovative business model, SDiX aims to support the creation of diamonds as an asset class that will benefit both the diamond trade industry as well as the financial and commodity markets.”

Anoop Mehta, President of BDB, said, “SDiX’s Exchange offers our members an additional channel to access diamond traders, including direct access to accredited financial investors and traders, and help generate additional revenue streams for our members. SDiX’s exchange platform will enable our members to better tap the opportunities in the market. We are delighted to provide space for the vault to store diamonds within BDB premises and wish them all the success in this venture.”