Bloomberg: Facebook's digital currency project is in danger of disbanding

 Bloomberg: Facebook's digital currency project is in danger of disbanding

Bloomberg's source said Diem Association is considering selling the property to refund investors.

The Diem Association is in discussions with investment banks about selling intellectual property and finding new places for engineers to develop the technology.

In 2019, when Facebook first announced the idea of ​​​​issuing digital currency to revolutionize global financial services, they partnered with nearly 30 companies, creating the Libra Association. However, this alliance is not enough to protect the project from scrutiny by global authorities. After Zuckerberg was called to testify by the US Congress, some partners left the project. Libra also changed its name to Diem at the end of 2020.

Diem's ​​ambitions dwindled. By last year, this Project Manager – David Marcus – left Meta. The consortium then partnered with Silvergate Capital to issue Diem, but opposition from the US Federal Reserve (Fed) made this last effort difficult, Bloomberg sources said.

Facebook's Diem cryptocurrency project is facing many difficulties. Photo: SOPA Images

Facebook's Diem cryptocurrency project is facing many difficulties. Photo: SOPA Images

In May 2021, Diem announced that Silvergate Bank would be the issuer of the Diem USD stablecoin – a digital currency pegged to the US dollar. USD is a currency commonly used to buy and sell other cryptocurrencies. However, after much debate between Diem's ​​supporters and officials, the Fed official finally informed Silvergate last summer that they were uncomfortable with the plan and could not guarantee it would allow it, the source said. reported by Bloomberg.

Without the green light, Silvergate cannot issue new assets. It is not yet clear how potential buyers will value Diem's ​​intellectual property, or what the fate of the engineers who helped develop it will be. The source said that discussions are still in the early stages and there is no guarantee that Diem will find a buyer.

Meta owns a third of this project, the rest are other members. They are venture capital funds (Andreessen Horowitz, Union Square Ventures, Ribbit Capital, Thrive Capital, Temasek Holdings) and technology companies (Coinbase Global, Uber Technologies, Shopify) that agree to invest to participate when the project takes shape. Fort. It is unclear at this time if any companies have stopped investing in the initiative.