Facebook-led Diem Association is Being Sold Off for Roughly $200M

According to reports, Facebook’s brief foray into cryptocurrency is coming to an end. According to a report published by the Wall Street Journal on Wednesday. The blockchain and crypto infrastructure of the Facebook-led Diem Association is being sold off to a Californian bank for roughly $200 million, According to Bloomberg, Silvergate Capital Corp had previously established an agreement with Diem to issue the association’s Stablecoin, but Federal Reserve shut off those efforts. Silvergate Capital Corp is a holding company for its crypto-focused bank, which provides financial infrastructure and services to players in digital assets. The move is seen as a way for the company to repay funds to its shareholders. According to the sources, Facebook parent Meta Platforms Inc. owns around a third of the association, and a group of the association’s members owns the remaining two-thirds. The Diem project, previously known as Libra, was mocked from the start for its intentions to provide a Stablecoin — a crypto asset, that is often pegged to a commodity or fiat currency — to billions of consumers throughout the world. Meta announced this idea in June 2019. PayPal, Stripe, and Visa were among the founding members of the group, which also featured a long list of some of the world’s top corporations. Concerns were raised in Washington a month later when Mark Zuckerberg, CEO of Facebook, was forced to explain to lawmakers how the project would not jeopardize world finance. The development of the project was halted as a result of funding cuts and governmental pressure.  The Libra Association tried a new approach in December 2020, but the venture continued to face challenges, including the resignation of senior executives. Meanwhile, David Marcus, who was in charge of Libra from the start as well as the development of Novi, left Facebook in December to pursue his own personal goals.

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