Wednesday, May 18

Meta Cryptocurrency Project Diem Plans to Sell Assets to Refund Investors

For Hannah Perez

Is the Meta (Facebook) digital currency project coming to an end? The Diem Association is seeking to return capital to its investor members, according to reports.


Diem, the controversial cryptocurrency project of Meta (before Facebook) is trying to sell its assets, which could indicate its final closure.

As reported Bloomberg, the diem association, the organization behind the digital currency initiative backed by Meta which was previously called Libra Association, is considering a sale of its assets as a way to return capital to its investor members. People familiar with the matter advanced the information to that medium.

The sources, who asked not to be identified because the discussions are not yet public, said that Diem is in talks with investment bankers to determine the best way to sell the intellectual property and find new jobs for its engineers. Discussions are ongoing and there is no guarantee the company will find a buyer.

Diem Association wants to sell assets

Originally Libra, the cryptocurrency project of Facebook entered the scene in 2019 with the ambitious plan to create a token digital backed by a basket of fiat currencies from around the world. However, the initiative was soon met with pushback from regulators and was forced to change plans.

Instead of a digital currency backed by various fiat currencies, Libra turned into several stablecoins linked to national currencies, and finally to a stablecoin pegged to the US dollar. He also changed his name to Diem. However, this also did not seem to meet the expectations of regulators, who continued to oppose the social media giant’s project.

Regulatory bodies raised concerns about the privacy and monetary sovereignty of nations at the time. The CEO of Meta, Mark Zuckerberg, and the former head of Diem, David Marcus, testified before the US House of Representatives.

Initially, the project secured backing from a handful of financial firms, venture capitalists and others, including eBay, Mastercard, Visa Y PayPal; although those companies soon left the association following regulatory pressure. The diem association still includes some of the biggest technology companies and investors, including Uber, a16z, Temasek, Spotify, Coinbase Y Ribbit Capital.

Beyond the regulatory pressure, it seems that the opposition from the US Federal Reserve (FED) gave the “Final strike” to efforts. In particular, the refusal of FED officials to Silvergate Bank, the banking partner with which Diem was associated last year and that it would be the issuer of the stablecoin, sources told Bloomberg.

Does Meta leave plans for a digital currency behind?

Ni Meta neither the members of the consortium have commented on it. On the other hand, a spokesman for the diem association, Michael Crittenden, told The Verge that the story of Bloomberg contained “some factual errorsbut declined to comment further.

The most recent reports suggest that the ambitious effort of Meta could be seeing its end, at least for now. Meta he still owns about a third of the company and the rest belongs to association members, according to Bloomberg. The members of diem association they agreed to invest and pay to join when the group was formed, although it is unclear which companies invested in the initiative.

In any case, there have been other signs that the cryptocurrency project is heading towards its end. Meta launched the wallet a few weeks ago New, which it initially developed for its digital currency Diem. However, this app came out with support for another stablecoin, Paxos Dollar (USDP), instead. Also, Marcus, the leader in charge of the digital currency and wallet initiative of Meta, left his position in November last year shortly after other members of the team also submitted their resignations.

Twitter co-founder Jack Dorsey shared the news about Meta on Tuesday along with the message, “Carpe Diem“.

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Sources: Bloomberg, The Verge, archive

Article versioned by Hannah Estefanía Pérez / DailyBitcoin

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