Facebook’s Bumbling Crypto Venture Diem to Wind Down, Sell Assets

Facebook founder Mark Zuckerberg’s ambitious program to create his own cryptocurrency is falling apart amid rising tension from regulators.

According to a Bloomberg report released Wednesday, the Diem Association, which manages the expansion of the Diem digital currency, is contemplating a sale of its assets to return money to its investors. The report adds Diem is selling its technology to crypto-focused small- California-based bank Silvergate Capital for $200 million.

Facebook, now known as Meta, established its cryptocurrency assignment in 2019 and virtually immediately ran into opposition in Washington. Bloomberg wrote, “One of the people speaking to Bloomberg under the condition of anonymity says that Meta owns about a third of the venture, and the remainder is owned by association members, such as Andreessen Horowitz, Union Square Ventures and Ribbit Capital.” 

Neither the representatives of Diem nor Meta responded to queries in this regard.

Diem (formerly Libra) is a permissioned blockchain-based payment system proposed by Meta Platforms. In May last year, Diem revealed that it had revoked its application to the Swiss Financial Market Supervisory Authority and said it would pursue the US treasury’s permission to register as a cash services business.