Why This Deal Could Mark A New Era For The $100B Diamond Industry

Diamond certification titan, World Gemological Institute (WGI) has announced a landmark deal that is set to revolutionize its business and could mark a new era for the $100 Billion diamond industry.

It is partnering with luxury industry fintech Vaultik to tokenize $3 Billion worth of diamonds, gemstones, watches and jewelry on the Hedera blockchain network.

Breaking this down, it means that clients will have an immutable digital certificate providing a secure way to track the provenance, grading, authenticity, and ownership of their WGI certified assets.

An additional insurance feature Vaultik has integrated—enabled via global broker Acrisure—brings additional value to the proposition as it means people can insure their goods directly via the certificates. While being practical, it also has potential as a lucrative new revenue stream.

According to a statement, the partnership addresses some of the most pressing challenges in the luxury market, including fraud, inefficiency, and lack of transparency. “It offers a unique opportunity to redefine how luxury goods are bought, sold, verified, and protected in the digital age.”

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“We’re thrilled to partner with Vaultik and Hedera to transform the way gemstones and luxury goods are authenticated,” said Noam Lenzini, Co-Founder and CEO of WGI. “In today’s world, the authenticity of our products must be indisputable. Tokenizing our certificates ensures that buyers and sellers can rely on a secure, verifiable system for confirming the value, authenticity and ownership of precious assets.” He added that this represents “a significant step towards establishing greater trust and security in the industry.”

WGI is the UK’s largest gemstone certification lab and Hedera is a high-performance, secure, and sustainable public, permissioned DLT or distributed ledger technology network.

Just as off chain diamond report numbers are microscopically laser inscribed onto a stone’s girdle—by the Gemological Institute of America (GIA) for example— each Token ID will also be laser-printed onto assets enabling cross-referencing with its corresponding digital certificate.

Offering customers an extra layer of protection against fraud, once an item has been certified by WGI, it will be sealed with an NFC chip, which must remain intact throughout the supply chain until it is accessed by the owner. If the seal is broken at any point, it will automatically invalidate the certificate. Upon receipt, the customer can scan the chip via their smartphone to access the digital certificate.

“The collaboration between Vaultik, the World Gemological Institute, Acrisure and Hedera marks a new era for diamond and gemstone certification,” said Pietro Novelli, Co-Founder and CEO of Vaultik. “Traditional paper-based certificates or emailed PDFs are prone to tampering and inefficiencies. By harnessing blockchain technology, we’re providing a far more secure, cost-effective solution that ensures authenticity, reduces fraud, and enhances consumer confidence.”

“In addition, the ability to purchase insurance directly via the certificates offers consumers immediate protection for their goods, while enabling authenticators such as gemologists, jewelers, and luxury goods dealers to offer a new, valuable service.”

Beyond this $3 billion enterprise level deal, Novelli described how WGI is also working closely with Vaultik servicing authentication requests made via the latter’s nascent consumer app “setting the stage for wider industry transformation.”

WGI authenticates any diamond or gemstone related assets uploaded to the application, he says, while the authentication of other categories of goods—luxury handbags, watches and other collectibles—is provided via “a global network of trusted collaborators.”

Other blockchain based solutions targeting the luxury industry at enterprise level include Aura Blockchain Consortium and Arianee Protocol. Where all are concerned, rollout and scale are critical for success.