Meta’s embattled cryptocurrency initiative, the Diem Association (formerly known as Libra) might be coming to an end as the company is reportedly planning to sell all its assets in a bid to return the capital to its investors. According to a Bloomberg report, Meta is in talks with investment bankers on how to sell the intellectual property and find a new home for the engineers who developed the technology. Also Read - WhatsApp announces Cloud API for large business, confirms Premium service for SMBs
Meta (formerly Facebook) first introduced Calibra (now Novi) back in 2019 as a way to revolutionise global financial services. At the time, it was backed by a consortium of investors with its cryptocurrency Libra (now Diem) being backed by hosts of currencies from around the world. At the time, the company had said that the first product of Calibra would be a digital wallet for Libra that would be available in Messenger, WhatsApp and as a standalone app in 2020. However, the idea didn’t hold up with the regulators. Also Read - No, WhatsApp will not let you leave groups silently
The company then introduced a simpler version in the form of Diem that was backed by the US dollar. For this, Meta partnered with Silvergate Bank to issue the Diem stablecoin. It is worth noting that stablecoins are considered less volatile compared to the traditional cryptocurrency as their value is tied to a specific asset, which in case of Diem was the US dollar. But it seems that Diem also failed to convince the regulators as the latter didn’t give a green light to Silvergate for issuing the stablecoin. Simply put, feds left Diem without a coin. Also Read - Meta Store opens doors to customers: All you need to know
Unable to move forward, now Diem is eyeing to sell all its assets.
Remittances are a critical way to achieve financial inclusion. Today, we’re rolling out a small pilot of the @Novi digital wallet app in two countries — the US and Guatemala. People can send and receive money instantly, securely, and with no fees. 1/8
— David Marcus – dmarcus.eth (@davidmarcus) October 19, 2021
Notably, the signs of Diem dissolving have been there for quite some time now. First, Meta launched a digital wallet – Novi – that was originally meant for Diem coin as a standalone app. It also introduced Novi wallet for WhatsApp in select countries. Then the Meta executive who led the company’s cryptocurrency efforts – David Marcus – left the company last year without citing a reason for his exit, The Verge noted.
While there’s still so much to do right on the heels of launching Novi — and I remain as passionate as ever about the need for change in our payments and financial systems — my entrepreneurial DNA has been nudging me for too many mornings in a row to continue ignoring it. (2/7)
— David Marcus – dmarcus.eth (@davidmarcus) November 30, 2021
Now, reports state that the company is planning to sell its assets and return the money to the investors, which include venture capital firms such as Andreessen Horowitz, Union Square Ventures, Ribbit Capital, Thrive Capital and Temasek Holdings Pte.