The Diem Association announced the sale of its intellectual property and other assets related to the management of the Diem Payment Network. The buyer was financial corporation Silvergate Capital.
Rumors about a possible sale of intellectual property to the Diem Association appeared last week. Diem Networks US CEO Stuart Levey recently confirmed this by saying that Goldman Sachs acted as financial advisor to Silvergate and Holland & Knight acted as legal advisor.
The CEO said that the Diem stablecoin would be a good payment solution for people who are unbanked or completely excluded from the traditional financial system.
However, the project, previously known as Facebook Diem and Libra, was not approved by the US Department of the Treasury, who feared that such a stablecoin would “grow across the planet” and jeopardize the global economy.
Regulators, says Levy, recognized Diem’s highly tamper-proof and secure payment services as innovative. And representatives of one of the regulators, according to the CEO, even called Diem “the most thoughtful stablecoin that the US government has ever seen.”
“However, despite the positive feedback, it was clear from Diem’s dialogue with federal regulators that the project could not move forward. As a result, the best solution was to sell the assets of Diem Group, which we did with the participation of Silvergate. We remain confident in the potential of stablecoins like Diem,” Levy said.
Last year, Diem announced its readiness to launch the stablecoin of the same name together with Silvergate bank. Earlier, Diem Association Chief Economist Christian Catalini called Diem’s original vision “naive” but added that with close cooperation with regulators, the project could succeed.
His expectations were not met, but thanks to a deal with Silvergate Capital Corporation for the sale of intellectual property, the concept of Diem can be realized to some extent. The Diem Association and its subsidiaries will begin winding down operations in the coming weeks, but the association “looks forward to seeing Diem’s designs and ideals come to fruition.”
Source: Bits
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