There’s always a light at the end of the tunnel and so it has been for the Facebook Diem project, formerly Libra! On Wednesday, May 12, Facebook’s digital currency group Diem Association announced the launch of its USD-pegged stablecoin dubbed Diem USD.
After going back and forth, facing major regulatory walls, making multiple tweaks. Facebook has finally made its way to the crypto space. With this launch, Facebook has also announced major changes at organizational levels. The Diem Association said that it’s relocating its operations from Switzerland back to the home country, the United States.
Thus, it will also be withdrawing its system payment license from the Swiss financial regulator, reports Reuters. The Diem Networks U.S., a subsidiary of the Diem Association, has registered itself as a money services business with the US Department of the Treasury’s Financial Crimes Enforcement Network.
Diem Networks U.S. Partners With Silvergate
Of course, this is a blockchain-based payments system that will facilitate real-time transfers of the Diem USD stablecoin. To issue the Diem USD, Facebook has joined hands with California-based state-chartered bank Silvergate.
Along with the stablecoin issuance, Silvergate will also be responsible for taking care of the Diem USD reserves. Stuart Levey, chief executive officer of Diem said:
“Silvergate is a leader in financial innovation and an ideal partner for Diem as we move forward with a blockchain-based payment system that protects consumers and enhances the integrity of the financial system. We are committed to a payment system that is safe for consumers and businesses, makes payments faster and cheaper, and takes advantage of blockchain technology to bring the benefits of the financial system to more people around the world. We look forward to working with Silvergate to realize this shared vision.”
Facebook’s Diem, formerly Libra, was first launched in April 2019 with some of the top financial giants like VISA, PayPal and Mastercard being a part of Libra Association. However, with massive regulatory pushback, several of its partners parted ways and Facebook has to tone down its ambitions with launching a global cryptocurrency.
Finally, after much effort, Facebook has found its way to work along with the U.S. regulators. Facebook will start pilot testing the Diem USD ahead of this year. Interestingly, today’s announcement comes just a day after Facebook CEO Mark Zuckerberg teased his ‘Bitcoin’ goat.