Mark Zuckerberg's Diem Project Completely Failed, Now Taken Over By Silvergate

Mark Zuckerberg, failed to develop Diem. (photo: doc. Unsplash)

JAKARTA - Meta Platform Inc, the parent company of the new successor to Facebook Inc, has officially announced the closure of its digital currency project, Diem. This shocking decision was forced to make by the US big tech company, after years of great effort to move forward with the initiative crows.

On Monday, January 31, Diem CEO Stuart Levey confirmed that Meta had sold intellectual property and other assets related to the Diem stablecoin project to Silvergate Capital Corporation.

"The Diem Association and its subsidiaries will begin to cease operations over the coming weeks," Levey said, as quoted by Cointelegraph. The association, however, is still confident that Diem's ideals will continue to thrive even after Meta officially discontinues its involvement in the project.

“We remain confident in the potential of stablecoins operating on blockchains designed like Diem to deliver the benefits that motivated the Diem Association from the start. With today's sale, Silvergate will be well-positioned to take this vision forward," said Levey.

According to an official announcement by Silvergate, the company will buy Diem's assets for an aggregate value of 182 million US dollars (IDR 2.6 trillion). "As part of integrating the acquired assets into Silvergate's existing technology, Silvergate expects to incur an additional $30 million in costs by 2022," the company said.

Specifically, Silvergate Bank, a Silvergate subsidiary and stablecoin partner Meta, will integrate its payments platform, the Silvergate Exchange Network, with Diem assets.

This new combination will help banks launch “a next-generation global payment system that is faster, easier to use, and more cost-effective than existing solutions,” the announcement notes.

“We identified the need for a regulated and highly scalable US dollar-backed stablecoin to better enable them to move money seamlessly. It remains our intention to meet that need by launching a stablecoin in 2022," said Silvergate CEO Alan Lane.

Mark Zuckerberg, owner of Meta officially introduced his digital currency project in 2019, originally called Libra and including the foundation of leading global companies such as Mastercard, PayPal, Visa, eBay, and others.

The project has come under massive global regulatory pressure, with financial authorities expressing major concerns over the tech giants potentially taking over too much financial power.

Despite heavy regulatory pressure, Meta is seeking to launch some of its services in the United States, with WhatsApp messenger testing payments with the Novi Meta wallet in December 2021.

“In the United States, senior regulators tell us that Diem is the best-designed stablecoin project the US government has ever seen,” said CEO Levey.

While the Diem Association is wrapping up its stablecoins, some of its original members are moving forward with their own stablecoin plans. In January, PayPal officially confirmed that it was "exploring a stablecoin" that could be called PayPal Coin.