- The Diem Association is reportedly selling off its crypto infrastructure for a sum of $200M
- A holding company for crypto-focused bank Silvergate has picked up the ticket
Facebook’s brief foray into crypto is reportedly coming to a close.
According to a report by the Wall Street Journal on Wednesday, the Facebook-led Diem Association’s blockchain and crypto infrastructure is being sold off to a Californian bank for around $200 million.
Facebook, now known as Meta Platforms Inc., did not immediately respond to Blockworks’ request for comment.
The bank, Silvergate Capital Corp., previously reached a deal with Diem to issue the association’s stablecoin, but those efforts were blocked by the Federal Reserve, according to Bloomberg reporting.
Silvergate Capital is a holding company for its crypto-focused bank which provides financial infrastructure and services to digital asset participants.
The move is viewed as a means to return capital to its investor members. Facebook parent Meta Platforms Inc. owns around a third of the association, according to the reports. The other two-thirds belong to a consortium of the association’s members.
From the outset, the Diem project formerly known as Libra was derided and railed against over its plans to introduce a stablecoin — a crypto asset generally pegged to a commodity or fiat currency — to billions of users worldwide.
Meta unveiled the ambitious project back in June 2019, much to the chagrin of US regulators and politicians. The association was formed alongside payments giants PayPal, Stripe and Visa and also included a long list of some of the world’s largest companies.
Concerns were raised in Washington a month later when Facebook’s CEO, Mark Zuckerberg, had to explain to congress how the initiative wouldn’t undermine global finance. Following funding cuts to the project, as well as the Meta-owned Novi crypto wallet and regulatory pressure, development stalled.
Meanwhile, David Marcus, who oversaw Libra from the beginning as well as the development of Novi, quit Facebook in December citing a need to pursue his own personal projects.