Meta has officially given up on its cryptocurrency project Diem. The news broke when Silvergate Capital confirmed that it was purchasing the technology behind Meta-backed cryptocurrency Diem, the IP, and assets on Monday.
Silvergate Capital to Carry On the Vision of Diem
Stuart Levey, the CEO of Diem Association, also corroborated that they had begun the process of winding down. Silvergate Capital is a crypto-focused bank working to lunch a stablecoin pegged to the U.S. dollar. The company is buying Meta-backed cryptocurrency Diem for $132 million in stock and $50 million in cash.
Despite closing down, Stuart said that the association remains confident in the potential for a stablecoin operating on a blockchain designed like Diem’s. Stuart added that the Diem Association believes Silvergate will be well-placed to take its vision forward.
Silvergate Bank, a partner of Meta’s stablecoin, plans to integrate its payment platform, the Silvergate Exchange Network, with the assets acquired from the sale of Diem. The bank plans to launch a next-generation global payment system that will be faster, easier to use, and more cost-effective than the current solutions.
Cryptocurrency Project Diem’s Journey
Meta-backed cryptocurrency Diem has had quite a journey. It has endured several rebrands, congressional hearings, and multiple high-profile staff departures. Stuart Levey said that after a dialogue with federal regulators, it became clear that the project could not move ahead. It is fair to say that Mark Zuckerberg gave Diem a shot before finally giving up now.
Starting as Libra in 2019, Diem initially garnered a lot of attention. The idea that it will enable seamless cross-border payments promised to open up the world. However, regulators across the globe whistle-blown that money launderers could misuse the project. Regulators also denied Diem Association’s bid to link the crypto-asset to the dollar.
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