Meta abandons the Diem project and sells its assets to Silvergate Capital
The Meta-initiated association has sold its intellectual property and technology assets to the California-based bank for $182m
Meta’s plan to expand into the cryptocurrency market by creating its own blockchain and launching the Diem cryptocurrency has come to an end. “The Diem Association today announced the sale of its intellectual property and other assets related to the running of the Diem Payment Network to Silvergate Capital Corporation” announced the association in a statement. The total value of the transaction amounts to approximately $ 200 million that will be used to return the capital to investors.
“Despite giving us positive substantive feedback on the design of the Diem Payment Network, it nevertheless became clear from our dialogue with federal regulators that the project could not move ahead. As a result, the best path forward was to sell the Diem Group’s assets, as we have done today to Silvergate” explained Diem CEO Stuart Levey. “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.”
Meta revealed its plans to roll out a digital wallet ‘Calibra’ and a virtual coin ‘Libra’ in June 2019. Meta had started a collaboration with Silvergate to put on the market a stablecoin linked to the US dollar.
Known as Libra until December 2020, project Diem started in June 2019, initially attracting well-known partners in the e-commerce and payments business – including PayPal, Visa, eBay and Stripe – with the purpose to build a digital wallet (“Calibra”) and a virtual coin (“Libra”). However, Meta's crypto project has met fierce opposition from U.S. monetary authorities, who have expressed concern over the impact such a project could have on financial stability and data privacy.
Recently, Meta has become a member of the Crypto Open Patent Alliance (COPA), a non-profit consortium of over thirty tech and crypto companies which aim to make digital assets open-source through the creation of a shared patent library.