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Facebook’s Cryptocurrency Dream Is Dead
SPAIN - 2021/06/02: In this photo illustration a Diem logo seen displayed on a smartphone with the Facebook logo in the background.
Thiago Prudencio/SOPA Images/LightRocket via Getty Images

Facebook-backed Diem Association has sold its assets to Silvergate Capital Corp, a bank which focuses on cryptocurrency, according to the company. This move essentially ends the Big Tech icon’s foray into the world of cryptocurrency, having previously hoped to encourage billions of Facebook and Instagram users to use its own cryptocurrency.

Silvergate Capital Corporation today announced that it has acquired intellectual property and other technology assets related to running a blockchain-based payment network from the Diem Group, further investing in its platform and enhancing its existing stablecoin infrastructure. Silvergate is uniquely positioned to leverage this technology to further solidify its position as a leader in the digital currency industry,” Silvergate announced in a statement.

“The assets acquired by Silvergate include development, deployment and operations infrastructure and tools for running a blockchain-based payment network designed to facilitate payments for commerce and cross-border remittances,” Silvergate added. “The network, which has been operating in a pre-launch phase, was built by a world-class group of engineers over a two-year development cycle with architectural quality evidenced by its security, reliability and scalability. Included in the acquisition are proprietary software elements critical to running a regulatory-compliant stablecoin network.”

According to Silvergate, the aggregate value of the transaction was $182 million.

“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,” Diem Association CEO Stuart Levey said in a statement.

The sale was the culmination of several years of struggle for Meta’s fintech unit, which lost most of its leadership, including director David Marcus, amid an exodus of staffers in the fall,” Fox Business reported. “It also throws into question how Meta plans to handle commerce in the metaverse, a futuristic digital environment that Chief Executive Mark Zuckerberg has heralded as ‘the successor to the mobile internet.’”

In 2020, David Marcus announced a rebranding of Facebook’s cryptocurrency venture, Libra, which was changed to Diem. 

Today, we’re excited to introduce Novi — the new name and brand for the digital wallet that will help people send and hold Libra digital currencies,” Marcus said. “While we’ve changed our name from Calibra, we haven’t changed our long-term commitment to helping people around the world access affordable financial services. Whether you’re sending money home to support the family members who supported you, or you’re receiving money from your friends no matter where they are, the Novi wallet will make money work better for everyone.”

Libra, the original name, was first announced in June 2019.

Congrats to my former colleagues and friends, as well as to [Silvergate Bank]. 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),” Marcus said in response to the news that Facebook’s cryptocurrency objective had come to an end. “Here’s to 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!”

Ian Haworth is an Editor and Writer for The Daily Wire. Follow him on Twitter at @ighaworth.

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