Facebook has given up. The Diem cryptocurrency will not be created

It was supposed to be a breakthrough, a complete novelty and a real revolution that would change online payments forever and finally convince the world to use cryptocurrencies. Meanwhile, everything indicates that it has been prepared for two years by Facebook cryptocurrency Diem (previously Libra) will not arise. US media reports that the Diem consortium is getting ready to sell its assets.

Facebook cryptocurrency it was a hit even when the first leaks appeared that it could arise. The first information from 2019 heralded a revolution in the standard of online payments. 

Recall: Facebook's currency was to be the so-called with stablecoin, i.e. a non-speculative cryptocurrency, which was to reflect the value of a specially composed basket of the most important fiat currencies. However, it was not supposed to be another means of payment, but a completely intuitive token that could be used to pay e.g. from the application level messenger. 

Its international character, mass use and a potentially simple interface promised its absolute success. However, it cannot be too good, because the biggest players on the financial market were well aware of it, and almost immediately the new project of Mark Zuckerberg began to be undermined. Central banks lamented that it would certainly be for nefarious purposes, with money laundering at the forefront. It was also supposed to shake practically the entire financial system in the world. 

When at the end of 2019, the Libra association, which was to manage the project, announced that the largest companies in the world - including Mastercard and Visa - had been invited to cooperate - the real stairs began. As a result of pressure from the US Federal Reserve, more partners who did not want to mess with the Fed shattered. 

Libra turns into Diem

There were so many changes that it was decided to rebrand the entire venture. Badly resembling Libra was renamed Diem. It was no longer supposed to use the basket of currencies, but to rely solely on USD and have reserves in the ratio of 1: 1 in American dollars. This play was intended to appease the Fed. 

In mid-2021, it even seemed that this plan worked, because the registration documents were even transferred from Switzerland to the USA, where the license was to be issued by the Silvergate bank from California. Moreover, Diem was supposed to operate only until the US introduced its own state-owned cryptocurrency.

“- We propose an approach similar to public-private partnership. We treat [Diem's ​​dollar token] as a temporary venture with partners like Silvergate acting as issuers. But when the CBDC (Central Bank Digital Currency) appears ... We are the only stablecoin issuer that has publicly committed to withdrawing its own token and replacing it with CBDC " - said Christian Catalini, CEO of the Diem project.

The FED has not laid down its arms, and the Diem cryptocurrency will not be

It turned out, however, that it was just a game of time or - if you prefer - a smoke screen on the part Federal Reserve USA. Another month is over, and not only has Diem not moved, but it looks as though he is unlikely to ever show up again. At least not in the form planned so far. 

Według BloombergSilvergate was under pressure from the Fed all the time, so the bankers withdrew from further arrangements, extended work, and issued virtually every decision, until the Diem consortium ended up giving up. Now it is preparing not to implement cryptocurrency, but ... sell off its assets. 

So it seems Mark Zuckerberg has sacrificed the project to protect his most golden child - Facebook. However, will it not return permanently and the plan of its own cryptocurrency when we least expect it? Time will tell.