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For time immemorial the U.S. dollar has reigned supreme in the diamond industry, making the relative strength or weakness of the American currency a factor that every non-American company needs to take into consideration.

It is element that can wreak havoc on a balance sheet almost overnight. Through mid-August of this year, the Russian ruble has fallen 14 percent again the U.S. dollar, and the Turkish lira was down 38 percent. Other countries fared even worse. The Iranian rial, for example, lost more than half its value in less than six months.

With diamond prices always pegged in dollars, non-American dealers and jewelers serving customers in their domestic markets are frequently forced to hike prices in local currency, or absorb a loss on a sale. But a strong dollar plays into the hand of non-American diamond manufacturers that export to the United States, for the cost of labor relative to the total value of the polished diamond may be diminished significantly.


But a change may be on its way. Earlier this month, Russian rough diamond producer Alrosa reported that it had introduced a pilot program in which it was accepting rubles  for purchases of diamonds. According to the company, customers from India and China and already taken part in the new scheme.

The companies participating in the Alrosa program were able to transfer to payment in rubles to branches of Russian banks in other countries, and this said Evgeny Agureev, director of Alrosa’s United Selling Organization, speeded up and simplified the payment process, because there was no need to use correspondent accounts with other banks.

“The practice in the international rough diamond market provides for settlements in U.S. dollars between sellers and buyers of rough diamonds. We have tested an alternative payment scheme to understand the possibility of its implementation and nuances to be taken into consideration. The experience is positive, so we will apply it on an as-needed basis,” Agurev stated.

In 2017 the U.S. dollar was undervalued, and  Alrosa blamed that as a reason for a fall in its revenues and profits. With payments received in rubles, this problem could fall away.


There are other payment options. Last year MID House of Diamonds announced that will begin accepting bitcoin as payment from clients for diamond and jewelry purchases, making it one of the world’s first gem dealers to recognize the cryptocurrency as legal tender.

But bitcoin and most other cryptocurrencies are notoriously volatile. At end of last year, bitcoin almost hit a high of $20,000 per unit, but today it is worth less than $6,500 per coin. For diamond businesses, the lack of stability makes them a risky proposition.

There are alternatives in the cryptocurrency realm. is an Israeli fintech company that has issued a digital coin, called CARAT, backed by diamonds. In other words, the company will hold diamonds with a value equivalent to that of the coins it has issued.  Where the price of most crypto-coins are a function of supply and demand, there the price of the CARAT coin is governed by upward and downward prices in the price of diamonds.