Facebook Cryptocurrency Is Basically Dead As Libra/Diem Considers Asset Sale

Facebook’s electronic money dreams may have been dashed. Libra, now called Diem, has By Meta Enter the world of stablecoins. However, after intense scrutiny by Congress and the US Federal Reserve, plans to release Mr. Diem appear to have failed.

Is Facebook’s Cryptocurrency Dead?

According to Bloomberg, the Diem Association, the Meta-backed initiative that developed Diem, is negotiating on how to best sell its assets. Since Diem never really got anywhere, any money raised would go toward returning investors money.

When Facebook revealed its plans to mine stablecoins in 2019, it was met with opposition from all sides. The public didn’t like it, the press wasn’t a big fan, and the government was skeptical, too. However, Zuckerberg is not one to let his intense disgust at everything he and his company do to keep him from implementing a plan. The original currency was called Libra and was used for payments in Facebook Messenger and WhatsApp.

However, this initiative is not an in-house scheme. eBay, Lyft, MasterCard, Spotify, Uber, Visa and others are founding members of the Libra Association. However, after regulators met Facebook’s crypto dream with skepticism, several key investors backed out before fully committing.

Despite the setbacks, the project continued, changing its name to Diem and eventually finding an issuer at Silvergate Bank. However, the Federal Reserve refused to give explicit approval and Silvergate did not have the confidence to hand Diem over to the risk of strong government repression.

With no issuer, Diem was essentially drowning in water, leaving Meta and other investors with no choice but to end the project. In addition, the Federal Reserve has no confidence in Meta’s ability to regulate usage, especially in light of Facebook’s myriad privacy issues, misinformation, and fraud. Whether this will prevent Meta from pursuing crypto in the future remains to be written.