Facebook’s DIEM Formerly Known as Libra Shuts Down Without Ever Launching

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By Shiela Bertillo

The intellectual property and other assets of the Meta-backed cryptocurrency Diem Payment Network has been officially sold to Silvergate Capital Corporation, a cryptocurrency-focused bank it was working with last year to launch a stablecoin pegged to the U.S. dollar. The news was confirmed by the team behind Diem on Monday, January 31st. 

In a press release published by Stuart Levey, chief executive officer of Diem, he stated that the decision “became clear from our dialogue with federal regulators that the project could not move ahead.”

“We remain confident in the potential for a stablecoin operating on a blockchain designed like Diem’s to deliver the benefits that motivated the Diem Association from the beginning. With today’s sale, Silvergate will be well-placed to take this vision forward. Over the coming weeks, the Diem Association and its subsidiaries expect to begin the process of winding down, but we look forward to seeing the design choices – and the ideals – of Diem thrive,” Levey wrote.

Diem, priorly named as Libra, was revealed by Facebook, now goes by as Meta, last June of 2019. It is a cryptocurrency which would be backed by an international consortium of companies and aims to be a universal cryptocurrency that could be accessed by digital wallets. Libra was set to launch within less than a year after the announcement but it was postponed several times; then two and a half years later Libra was rebranded as Diem. 

The project, from Libra to Diem, has always been under the close monitoring from regulators, lawmakers and other financial services industry watchers. These watchers were suspicious of the currency that would be available to Facebook’s billions of users especially when most countries lack the regulatory infrastructure to effectively oversee digital money. They also added that Libra could threaten national currencies as well as financial markets, and that it could enable cybercrimes and compromise user privacy. 

Moreover, members of the Libra Association, a group initially composed of more than two-dozen companies and nonprofits that would govern Libra and its reserve, started to drop out, just months after the group had been announced.

And now, after years of struggle, rebrands, congressional hearings, various setbacks, regulatory pressure and several high-profile staff departures, Diem has officially called it quits.

David Marcus, the former Facebook executive who created Libra and left late last year, tweeted about Diem shutting down; he greeted his former colleagues and friends, as well as to Silvergate congratulations.

“We all gave our whole hearts, blood, sweat and tears to what I will always call Libra. We were mission driven and were in it for the right reasons (that remain as valid today as they were then),” he wrote.

He also noted that the sale of Diem is “yet another chapter with a maybe more “acceptable” promoter driving the vision forward.”

“There will be ample time in the future for me to properly reflect on the behavior of certain politicians and regulators along the way, but for now… onward!” he added.

On the other hand, Novi, Facebook’s digital wallet (but without Diem) recently received a Virtual Asset Service Providers (VASP) license from the Banko Sentral ng Pilipinas (BSP). Stepping away from Diem, Novi users could instead send and receive a different digital coin. (Read more:  PayMaya and Facebook Novi Philippines Receive Virtual Currency Exchange License from the BSP)

This article is published on BitPinas: Facebook’s DIEM Formerly Known as Libra Shuts Down Without Ever Launching

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