Meta’s Cryptocurrency Diem to Shut Down
Updated · Feb 02, 2022
Meta will officially shut down its stablecoin project originally launched in 2019.
The Diem Association has announced that it will be shutting down. Following months of speculation, Meta (formerly Facebook) released a statement to that effect on Monday.
According to the association, Diem’s assets were sold for $200 million to Silvergate, a fintech and cryptocurrency-focused bank.
In the released statement, Stuart Levy, Diem CEO blamed the sale on regulators.
“Despite giving us positive substantive feedback on the design of the network, it nevertheless became clear from our dialogue with federal regulators that the project could not move ahead,” he wrote. “As a result, the best path forward was to sell the Diem Group’s assets, as we have done today to Silvergate.”
Diem has experienced a turbulent journey since Mark Zukerberg announced the project in 2019. Originally known as Libra, Meta had plans to make it a permissionless blockchain-based stablecoin payment system. Soon after, scrutiny regarding the tech giant’s involvement caused some of the original partners pull out.
Subsequently, a barrage of roadblocks from regulators and lawmakers saw the project undergo a series of rebrands and setbacks. Chief among the concerns was that it would be used to avoid money laundering laws and to finance terrorist groups. Even a name change to Diem to show its independence from Meta did not help.
California-based Silvergate has made it clear that it plans to release a stablecoin later this year.
“It remains our intention to satisfy that need by launching a stablecoin in 2022, enabled by the assets we acquired today and our existing technology,” CEO Alan Lane said.
Daniel is an Economics grad who fell in love with tech. His love for books and reading pushed him into picking up the pen - and keyboard. Also a data analyst, he's taking that leap into data science and machine learning. When not writing or studying, chances are that you'll catch him watching football or face-deep in an epic fantasy novel.
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