Centaline Property Agency founder Shih Wing-ching has poured more than HK$10 million into a peer-to-peer diamond exchange that aims to capitalize on the trading of second-hand diamonds, the Hong Kong Economic Journal reported Monday.
Shih’s AM730 Startup Fund, which was set up about four years ago to support new businesses, has invested in the P2P diamond exchange recently, according to the report.
AM730 Startup Fund was set up with venture capital of HK$30 million, about HK$10 million more than the originally planned figure.
The fund has made several investments but most of the ventures have either been wound up or are making losses.
It has stopped new investments now, and is instead focusing on the diamond exchange — which is officially known as the Hong Kong Accredited Diamond Exchange, the report said, citing Shih.
The exchange’s co-founder Cherry Leong was quoted as saying that an online platform can provide a fair environment for people who wish to sell their diamonds.
If an individual tries to sell a diamond through a jewelry or pawn shop, he is likely to suffer discounts of up to 50 percent on the value of the items, Leong said, adding that an online trading problem will provide better a deal.
The exchange will be launched by the end of February. It will target mainland Chinese and Hong Kong people initially, but will aim to eventually serve clients globally.
Sellers will be required to acquire internationally accredited certificates such as GIA and AGS before listing their diamonds on the exchange for sale.
Diamonds should be at least 0.85 carat to be listed on the exchange.
The exchange is expected to resolve the problem of opacity in second-hand trade of diamonds and reduce the discounts suffered by sellers.
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