"Alaska black diamonds" is the trade name of a mineralized form of iron oxide known as hematite. Hematite occurs around the world, and the milled gemstones created from it hold a lustrous black finish. Hematite has been called bloodstone because it can be ground into a dark red powder that the ancients believed to be coagulated blood, hence its use as an amulet for pre-scientific medical applications.
Hematite powder's association with dried blood is not totally unwarranted. The red powder it degrades into is, in fact, rich with oxidized iron. Iron oxide is what gives red blood cells their characteristic color, and the compound, known commonly as rust, is also prevalent in the surface soils of Mars.
Hematite is common on Earth, and it is the main form in which iron is mined from the crust. The mineral was laid down globally in huge deposits known as banded iron formations mostly between 1.8 and 2.4 billion years ago as oxygen proliferated in the atmosphere. Free iron is unstable in the presence of oxygen, and the loose iron in Earth's oceans reacted to its presence by oxidizing and precipitating out to form the hematite deposits from which Alaskan black diamonds would later be quarried.