The price fetched by the 76-carat jewel at the Christie's sale is a record for the auction of a clear, colourless diamond.
It is also the highest auction price per carat for such a gem and the record for a Golconda diamond, the same mines which produced the Koh-i-Noor, which adorns the British Queen's crown.
"It's a cushion-shaped diamond, weighing 76.02 carats, of D colour" the purest, most colourless variety of diamond, a rarity and a specialty of the ancient Golconda mines in the Indian state of Andhra Paradesh, said Christie's jewellery expert Jean-Marc Lunel.
The 'Archduke |Joseph,' which was bought by an anonymous bidder, once belonged to the Habsburgs, former rulers of the Austrian empire.
It takes its name from the Archduke Joseph (1872-1962) who was for a short period the Hungarian head of state.
The diamond was sold in 1936 to a still-anonymous buyer and, hidden in a safe, escaped the attentions of the Nazis during the Second World War .
It reappeared on the international scene at a sale in London in 1961.
In the 1990s it was sold again, in Geneva, for $6.5 million.
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