Tech

Facebook-backed Mr Diem’s ​​association confirms it’s ‘going downhill’


Diem, the ambitious Facebook-funded cryptocurrency project has collapsed. Fringe Guild confirmed that it was selling its assets to Silvergate, which had previously partnered with the group, and that it would “start the cooling process.” Bloomberg Yes report negotiations for a purchase last week. A spokesman for the Diem Association at the time alleged that the report contained unspecified “facts of error”.

Now that the sale is official, it marks the end of Mark Zuckerberg’s more than two-year effort to launch the champion stablecoin. Although the Diem Association is a separate organization from Facebook and its parent company Meta, most of its funding comes from Facebook. “I believe this is something that needs to be built, but I understand that I’m not the ideal messenger for this right now,” Zuckerberg told Congress in a statement. Hearings in 2019 about his crypto ambitions.

The group formerly known as the Libra Association reported that debut its stablecoin last January. But it hit repeated roadblocks from lawmakers and regulators around the world, and the project was delayed and shrink many times. Among officials’ top concerns was that Diem could be used for money laundering and other nefarious purposes.

In a statement, Diem’s ​​CEO, Stuart Levey, blamed US regulators for Diem’s ​​departure, and defended the organization’s work to mitigate risks with “measures” industry-leading controls to protect consumers and fight financial crime.”

“Despite giving us positive feedback on the substance of the network’s design, through our dialogue with federal regulators, it became clear to us that the project could not proceed. up,” Levey. “Therefore, the best way forward is to sell the assets of the Diem Group, as we do today to Silvergate.”

It’s unclear what this means for Facebook’s Novi crypto wallet, launched a “small pilot” last year with stablecoin Pax Dollar. At the time, Facebook’s former head of crypto David Marcus said the company remained committed to launching Diem. Marcus left the company a month later. Facebook did not immediately respond to a request for comment.

Update 1/31 9:25 p.m. ET: “So far, Diem’s ​​journey has been an ambitious and challenging one,” Novi head of Meta, Stephane Kasriel, wrote on Twitter. “We hope that the Association sells their property to @silvergatebank will allow the project’s vision to come to life. Because we still believe in a shared mission of financial inclusion. “

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