The Diem Association, a group of companies working on a blockchain-based payment system, is reportedly selling its technology assets to Silvergate Capital for $200 million, according to the Wall Street Journal.
Meta, formerly known as Facebook, is one of the founding members of the Diem Association.
Bloomberg also reported that Meta was in the process of selling Diem’s assets as a way to return some capital to the investors behind the project.
Previously, Facebook planned to introduce Libra in 2019. Since then, Facebook and Diem have stepped up their efforts many times over. Libra was initially conceived as a digital token backed by numerous international fiat currencies.
From the very beginning, the Diem Association faced strong opposition from regulators and central banks, as many believed that Libra would compete with sovereign currencies with numerous macroeconomic effects. Others argued that the project would have created shadow banking, inflation and a way out of monetary policy.
The Diem Association later shifted to a more realistic view of stablecoins, deciding to launch several single-currency stable coins.
The Diem Association, with Facebook, launched a trial of Novi, a cryptocurrency wallet, using the USDP as its currency, issued by Paxos with Coinbase managing crypto custody.
In addition, the director who originally proposed Libra and in charge of Meta’s digital wallet, David Marcus, left the team. While many others followed suit.
According to the Wall Street Journal, Silvergate Capital would issue some of the stablecoins and repay them with cash from their account.
With the sale of the Diem Association, Meta and its partners are likely to get some of their money back. Silvergate Capital, on the other hand, will be the sole company responsible for the Diem project.
Other companies currently involved in the project include Anchorage, Andreessen Horowitz, Checkout.com, Coinbase, Iliad, Spotify, Uber and Union Square Ventures.
