Ice Diamond Riddle SOLUTION ft. Vsauce's Michael Stevens

I still see the diamond while it is encased in the ice as adding to the specific gravity of the ice, thus displacing more than a plain ice cube would.  The volume of the ice is reduced as it melts, but the diamond isn't.  When the diamond sinks after the ice melts, the water level hasn't changed.  Guess I didn't pay attention in physics class....