Dubai-based Al Kasir Group launches diamond backed crypto assets
A joint venture with the private investment office of Sheikh Ahmed Bin Obaid Al Maktoum was established to market and sell physical diamonds, precious gems as well as private blockchain technology based digital assets.
- Al Kasir Group launched three new crypto assets that, unlike other virtual coins, are backed by a real-world asset which makes them more stable and secure.
- Cryptocurrencies are highly volatile and subjects of speculation, which makes them poor store of value and means of exchange.
- Blockchain has a huge potential to be used in real world business application, separate from cryptocurrency trading.
Dubai-based Al Kasir Group announced on 15 April 2018 that it has launched three crypto assets backed by certified diamonds. Through a joint venture with the private investment office of Sheikh Ahmed Bin Obaid Al Maktoum, a member of UAE’s ruling family. The group established Al Kasir Jewellery Trading and the Al Kasir online portal to market and sell physical diamonds, precious gems as well as the private blockchain technology based digital assets.
Founder and director of the AL Kasir Group, Amit Lakhanpal said: “Cryptocurrencies with their underlying blockchain technology are increasingly popular with individuals, financial institutions and governments. However, many of them view cryptocurrencies as objects of radical speculation and highly volatile. Since they are subject to potentially huge price corrections, most cryptocurrencies are practically a poor store of value and means of exchange. This gives rise to a need for a more secure alternative.”
The company will introduce a set of three crypto assets backed by Indian Gemological Institute (IGI) certified diamonds: Al Mas, Al Haqeek and Al Falah. “These are better capable to store and translate value as there is a real asset on which they are based,” he added.
The crypto assets and actual diamonds and precious gems will be made available for purchase across the counter as the company aims to open 1,000 stores across the world including in South-East Asia, Europe, the UK and the Gulf region. The public trading of the crypto/digital assets will commence tentatively between 21 and 24 August, 2018 during Eid Al Adha. The company will be investing up to AED25 million ($6.8 million) in the distribution, marketing and promotion of the venture, which it will be expanding through franchise and agency arrangements.
The company announced that during the four phases of the initial crypto asset offering (ICAO), buyers will be offered physical diamonds and bonus crypto assets through the company’s online shopping portal. The bonus assets will be equivalent to 100% of the value of the physical gems in the first phase of the offering and will be gradually reduced for subsequent phases, 30% in the final phase. Investors, who wish to buy these crypto assets, will have a variety of packages to choose from, ranging from a minimum of $250 to a maximum of $250,000. The company aims to attract buyers from all social and economic segments. Each crypto asset or coin will have a nominal value of $10. The company hopes to sell up to $100 million of physical and digital assets through the ICAOs.
Amit Lakhanpal (left), chief executive officer of Dubai-based Al Kasir Group, and Mohammed Aljariri, director of company's affairs at the private office of Sheikh Ahmed Bin Obaid Al Makhtoum.
Lakhanpal, an Indian entrepreneur and property developer who also owns an Estonia-licensed and based crypto-currency exchange, MoneyTrade Coin, said: “Along with the diamonds the buyer will also get crypto assets. These crypto assets can subsequently be used to procure a range of products like precious stones and perfumes from the company’s online shopping portal. The buyer can redeem only 50% of the product purchase value in crypto assets and the remaining 50% will have to be made via cash payments for future purchases.”
“Diamonds are an ideal asset backing for crypto assets as they are rare, taking a billion years to develop, have several millennia of history as a recognised store of value, and are small and therefore easily stored and transported. The three crypto assets are designed to seamlessly address the need of security, combining the convenience of digital currencies by being utilised as crypto assets with the stability of traditional assets,” he elaborated.
The three crypto assets will be traded on a Kasir Group owned crypto asset exchange that will provide the flexibility of inter-changeability of coins and be traded directly against diamonds, precious gemstones, as well as oud, bakhoor and attar (perfume), to add more value. And because they will be traded on a private exchange, have pre-set nominal values and no or limited use except for the purchase of physical diamonds and gems within the Kasir Group, prices are not likely to see much fluctuation, if any at all. Hence will not be viewed or valued as objects for speculation, unlike “conventional” cryptocurrencies.
“Bitcoin and ethereum are two major cryptocurrencies that have been dominating the cryptocurrency economy far longer than others. With the ability of utilising bitcoin and ethereum for trading with these three crypto assets, the exchange will provide for smooth transitioning for crypto-investors who are keen on investing in these diamond-backed crypto assets,” Lakhanpal concluded.
He painstaking explained that these are crypto or digital assets and not to be associated with cryptocurrencies. It is perhaps an instructive example of the potential for blockchain technology to be used for a real world business application, albeit of a more product marketing and promotion leaning. Whether they hit the $100 million target will prove if they can be as successful as cryptocurrencies.
Keywords: Blockchain, Crypto Assets, Bitcoin, Technology, Cryptocurrency
Institution: Al Kasir Group