For about 200 million dollars, Diem (or Libra) Mark Zuckeberg’s dream of creating a digital currency to exchange between Facebook and WhastApp users will end up in the hands of a financial specialist in the crypto ecosystem.
That’s right, Facebook’s idea of “reinventing money” with a currency called Diem will be nothing more than a sore flop in the history (successful, by the way) of the world’s largest social media holding company.
At the beginning of last week there were rumors that Zuckerberg was trying to disassociate himself from the project due to the little interest generated and because regulators around the world, especially in Europe and the United States, blocked the attempt.
This week, according to the Wall Street Journal, the Diem Association, the consortium of venture capital companies and tech firms formed in 2019 to carry out the payment network project concocted by Facebook, is selling its technological assets. to Silvergate Capital, a bank focused on the cryptocurrency business.
The agreement, according to the same New York media, will be for around US$200 million.
What Silvergate Capital will do with Diem, the former Facebook project
Silvergate Capital is tied to the issue. In fact, it is the parent company of Silvergate Bank, the bank that was going to carry out the issuance of the stable currency “Diem USD”, the token linked to the value of the dollar that was going to be used for transactions between users of Facebook and Facebook. WhatsApp.
A stablecoin is a currency linked to a stable asset, in this case the dollar, which removes the volatility typical of classic cryptocurrencies, such as Bitcoin, for example.
When Facebook generated the creation of the Libra Association together with an important group of companies from different origins, it never thought that the regulatory bodies would prevent the project. And if he thought about it, he did not imagine that this pressure would be enough to turn the project around, but they succeeded.
Regulators were concerned that Diem USD could be misused and pose risks to financial stability and information privacy.
For this reason, little by little, all the project partners were dropped, from PayPal to Visa and MasterCard cards, through banks and other important technology companies.
Two years ago, with the departure of David Marcus, the head of the Diem project at Facebook, the end of the idea was very close.
An article from Bloomberg notes that it is likely that Silvergate Bank could launch its own stablecoin, but without Meta’s backing it will be one of several already on the market, like USDT (Tether), for example.
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