The Diem Association, a controversial Meta-backed cryptocurrency project, is reportedly looking to sell its assets to return capital to investors, Bloomberg reported.
The association is reportedly in discussion with investment bankers on how to cash out on the project, including selling its intellecutal property and finding other work for its developers and engineers. Sale discussions are still early and there is no guarantee that Diem's assets will be bought, people familiar with the conversations told Bloomberg. Meta owns around a third of Diem, with the rest owned by members of the association, which includes VC firms and other tech companies.
The news comes a few months after David Marcus, founder of Diem, announced his departure from Meta's financial technology unit, which was recently renamed from Facebook Financial to Novi. Novi introduced a long-expected digital wallet last year to a limited set of users, and relied on a stablecoin from Paxos, not the still-unavailable Diem coin.
Diem, which was originally known as Libra, drew strong regulatory scrutiny. First unveiled by Facebook in 2019, Diem aimed to create a stablecoin linked in value to a basket of fiat currencies. Diem announced in May that Silvergate Bank would be the issuer of its currency.
Silvergate CEO Alan Lane said during the bank's fourth-quarter earnings call last week that it was "ready to launch something in 2022" and it's applied with the New York State Department of Financial Services to form a trust company for holding stablecoin reserves. He didn't specifically address the status of Diem in the call.