UPDATE: The Meta-linked Diem Association has confirmed the sale of its assets to Silvergate, the crypto-aligned banking institute. This effective kills off Facebook’s plans to launch its own cryptocurrency, though it leaves the company’s digital wallet ambitions on the table.
Silvergate said that it paid $182 million (R2.8 billion) for all of the company’s assets, including intellectual property. It’s possible the in-develop currency will see the light of day, but it won’t be under Meta’s banner. Unless Meta’s funding Silvergate’s buyout in an attempt to be sneaky and continue development at arm’s length. There’s literally no evidence for that, but it’s just the sort of trick we’re supposed to suspect any large-enough company of using to try and bypass regulators.
ORIGINAL STORY: Back when Meta was still Facebook, the company announced a proposed cryptocurrency called Libra. It was, at some point, renamed to Diem. Pretty much from the outset, it was slated as a terrible idea. And now, it might be on the chopping block entirely.
A report from Bloomberg claims that the Diem Association, which Facebook set up to manage the currency, is looking to offload its assets.
Carpe Diem. Seize the… carp?
The reason given for this apparent abandonment of Facebook’s crypto ambitions is regulatory opposition to the stablecoin. The US Federal Reserve has apparently “dealt the effort a final blow” by putting pressure on a banking institution Silvergate, which was in line to support Meta’s efforts. That pressure caused the bank to back off, which might well have shot Diem in the leg.
Diem hasn’t had much of a comment on rumours that it is selling off its assets, but it might not matter in the long run. Facebook (now Meta) appeared much more concerned with a linked product called Calibra. The digital wallet, now known as Novi, is being tested in the real world. It may even have been Meta’s target all along.
Novi is more attractive to the social media giant than managing its own crypto. It lets Meta get its hooks into spending and savings information for its billions of users, without having the hassle of managing a digital currency. This would allow Facebook to further develop user profiles in ever-more specific ways. That is, assuming the wallet takes off and becomes a standard for Meta. Diem, at the end of the day, may not matter at all.