Sotheby's diamond auction marks another bitcoin milestone

Flags fly on the front of Sotheby's auction house, in New York, Monday, June 17, 2019. (AP Photo/Richard Drew)

A rare pear-shaped diamond that is expected to fetch up to US$15 million can be bought at auction next month using cryptocurrencies, Sotheby's announced on Monday.

Sotheby's said it would be first time a diamond of such size has been offered for public purchase with cryptocurrency. No other physical object of such high value has previously been available for sale with cryptocurrency, the auction house added.

The 101.38-carat pear shaped flawless diamond, dubbed The Key 10138, is one of just ten diamonds of more than 100 carats ever to come to auction, only two of which were pear-shaped.

It carries a pre-sale estimate of $10 million - $15 million and will be sold on July 9 in Hong Kong. Bitcoin or ether, along with traditional money, will be accepted as payment.

“This is a truly symbolic moment. The most ancient and emblematic denominator of value can now, for the first time, be purchased using humanity’s newest universal currency," Patti Wong, chairman of Sotheby's Asia, said in a statement.

Cryptocurrencies have had a volatile year, with explosive growth and major tumbles. In the United States, the National Republican Congressional Committee last week said it will accept donations in cryptocurrency; El Salvador this month became the first country to adopt Bitcoin as legal tender.

Sotheby's in May sold a Banksy for $12.9 million in the first instance of a work of physical art sold by a major auction house that was bought with cryptocurrency.

Sotheby's said that the past year has seen strong demand for white diamonds, jewels and other luxury items, particularly from younger people, including those in Asia.

The name of the colorless diamond - Key 10138 - is intended to reflect the integral role that keys occupy in the world of cryptocurrencies.

Pear-shaped diamonds are among the most sought after. The 530 carat Cullinan 1 diamond, which forms part of Britain's Crown Jewels, is the most famous example.

The top price paid for a colorless diamond at auction was a 118.28 carat oval that went for $30.8 million at Sotheby's in Hong Kong in 2013, with a record price per carat of $260,252.

Reporting by Jill Serjeant; Editing by David Gregorio.