Diem Association sells assets and abandons stablecoin launch – Bits Media

Diem Association announced the sale of its intellectual property and other assets, related to the management of the Diem Payment Network. The buyer was the financial corporation Silvergate Capital.

Rumors about a possible sale of intellectual property to the Diem Association appeared last week. Diem Networks US CEO Stuart Levy (Stuart Levey) confirmed this information the other day, Submitting, that Goldman Sachs acted as Silvergate's financial advisor, and the functions of legal consultant were performed by Holland & Knight.

The CEO stated, that Diem stablecoin would be a good payment solution for people, unbanked or completely excluded from the traditional financial system.

However, the project, formerly known as Facebook Diem and Libra, was not approved by the US Treasury, fearful, that such a stablecoin would “grow all over the planet” and threaten the global economy.

Regulatory Authorities, Levi assures, recognized Diem's ​​well-protected services from unauthorized access and ensuring payment security as innovative. And representatives of one of the regulatory bodies, according to the CEO, even called Diem “the most thoughtful stablecoin, that the American government has ever seen".

"However, despite positive reviews, it became clear from the dialogue between the Diem association and federal regulators, that the project cannot move forward. As a result, the best solution was the sale of Diem Group assets, which we did with the participation of Silvergate Bank. We remain confident in the potential of stablecoins, like Diem", - Levi said.

Last year, Diem announced its readiness to launch a stablecoin of the same name together with Silvergate Bank. Formerly Chief Economist of the Diem Association Christian Catalini (Christian Catalini) called Diem's ​​original concept "naive", but added, that with close cooperation with regulators the project can achieve success.

His expectations were not met, but thanks to a deal with Silvergate Capital Corporation for the sale of intellectual property, Diem concept can be implemented to some extent. The Diem Association and its subsidiaries will begin to wind down their activities in the coming weeks., however, the association “looks forward to seeing Diem’s designs and ideals come to fruition.”.