Diem Association, which is backed by Meta (formerly Facebook), is in the process of selling assets and transferring capital, Bloomberg reported. Amidst regulatory obstacles, Meta is reportedly calling time on its ambitious and controversial cryptocurrency project that its CEO Mark Zuckerberg has once defended before the US Congress.
There are reports that Diem is in contact with investment banks in order to sell its intellectual property. The group is also looking for new places for development. But it is not guaranteed that Diem will be able to sell.
Meta owns about one-third of Diem, while several tech companies and venture capitalists hold the rest. In addition to Andreessen Horowitz and Union Square Ventures, Diem’s website states that Ribbit Capital, Thrive Capital and Temasek Holdings Pte are investors in the venture.
“The cryptocurrency initiative, originally called Libra and renamed Diem Association later,” Fortune reported on Tuesday, citing people familiar with the matter, is considering a sale of its assets to return capital to its investor members. In October 2019, Facebook and 20 partner organizations officially joined the digital currency project.
Due to privacy concerns, several heavyweights pulled out of the Libra project, including PayPal, Mastercard, Visa, Mercado Pago, eBay, Stripe, Booking Holdings, and Vodafone.
While Meta planned to launch a stablecoin in the first half of 2020, the company abandoned the project because of regulatory pressure. Due to negative feedback it received on the first version, Meta changed the project’s name from Libra to Diem in the same year.
Meta’s crypto initiatives director, David Markus, left the company in November after the Fed’s intervention disrupted plans for partnering with crypto-friendly Silvergate Bank.