Having successfully launched the world’s first and only electronic commodities exchange trading physically settled diamonds earlier this year, the Singapore Diamond Investment Exchange (SDiX) has announced it has selected Kynetix’s Sentinel platform as the strategic solution to support the launch of new products and functionality over the next 10 years.
Kynetix has unique experience providing inventory and physical delivery platforms to global commodity exchanges such as the LME and the Intercontinental Exchange whose respective LMEsword, LMEshield and ICE Guardian platforms underpin the global trade and financing of base metals, coffee, cocoa, sugar, wheat and gold.
Sentinel, Kynetix’s flagship market infrastructure platform connects the physical economy with financial markets and enables the effective management of records of title, ownership, rent and storage charges plus management of depository processes for commodities. This presents opportunities to unlock collateral, streamline settlement and further enhance the trust and transparency of physical commodity markets.
With proven exchange technology and a unique settlement infrastructure, SDiX provides end-to-end trading for global participants, and price discovery in both immobilised single stones and ‘baskets’, which are fungible collections of investment-grade diamonds. Both single stones and baskets can be traded electronically on a price/time priority in a continuous market and buyers can place indicative price bids by diamond category.
Alain Vandenborre, Executive Chairman and Founder of Singapore Diamond Investment Exchange commented: “With trading on the Exchange successfully underway, SDiX is looking beyond the development of a vibrant spot trading market for diamonds towards the creation of more sophisticated investment products such as derivatives.
As we continue building liquidity, develop plans to implement a unified, global electronic depositary system and a fully warranted physically delivered diamond futures contract with multiple points of delivery, we are confident that this new partnership with Kynetix’s Sentinel platform will provide the robust foundation to support our growth and the ongoing development and diversification of our product offering.
SDiX is backed by leading global investors including Vertex Venture Holdings, one of the longest operating venture capital firms in Asia and a wholly-owned subsidiary of Temasek Holdings, Singapore’s sovereign wealth fund. Early investors include Jim Rogers, Hsieh Fu Hua, Sun Tongyu, and Cai Wensheng.
“We’re extremely proud to be collaborating with such an innovative exchange who like us are looking to bring fresh thinking to long-established, traditional commodity markets. Having worked with some of the oldest establishments in commodities trading, we understand the multi-faceted challenges in driving liquidity and transparency to commodity contracts through the adoption of new technology” said Guillaume Kendall, Head of Business Development at Kynetix.