Sotheby’s Crypto Sale Less Than Dazzling

RAPAPORT… A much-anticipated cryptocurrency sale at Sotheby’s Hong Kong fell short of expectations, as only one of the eight pieces up for auction found a buyer, the company told Rapaport News Thursday.

On offer was a Harry Winston necklace containing a total of 177.51 carats of diamonds, including nine graduated pear-shaped, D-color, internally flawless stones. The jewel was intended to be the headline item, and it was the first signed jewel ever to be offered with a cryptocurrency option. It was expected to fetch up to $5.9 million, or 128 bitcoins but remained unsold, failing to meet the reserve price.

Sotheby’s named the sale “Diamonds: The Dazzling ∞” — using the mathematical symbol for infinity.

An additional six loose D-color diamonds ranging from 8.08 to 50.05 carats also went unpurchased. Those included a brilliant-cut, 11.88-carat, D-color, VS1-clarity diamond with a high estimate of $1.2 million, or 26 bitcoins.

“In [our previous jewelry sale] we saw [a] strong performance for diamonds, especially colored diamonds where the top lot was sold for HKD 35 million [$4.5 million],” Sotheby’s explained. “Comparatively, there was some market resistance in the Diamonds: The Dazzling ∞.”

The sale was “specifically targeted for buyers paying with crypto,” the company added. “With the recent surge in value with some of the cryptocurrencies, there is a possibility that the timing might have dampened buyers’ willingness to trade out for purchases.” 

The company pushed back the sale from September 24 to October 19, without stating why it did this. Last month, Chinese regulators banned cryptocurrency transactions — raising the question of whether this would affect demand at the auction, since many bidders are from the mainland.

The one piece the auction house sold was a 10.88-carat, D-color loose diamond, which went for HKD 7.2 million ($925,843), in the middle of its estimate. Sotheby’s would not confirm whether the piece was purchased with cryptocurrency or by other means.

However, the company is still hopeful it will sell some of the pieces from the auction.

“We are actively working with prospective buyers on post-auction offers,” Sotheby’s added.

Image: The Harry Winston diamond necklace that failed to sell. (Sotheby’s)