According to recent reports, Diem, the crypto initiative backed by Meta, has been looking to auction its entire assets and is actively looking for buyers. If the reports are true, this implies that the initiative is cutting ties with Mark Zuckerberg. In fact, Diem’s action seems to be torching Mark’s imperial ambitions of creating a stablecoin that acts as the immediate connect site.
Diem, the crypto initiative which previously went by the name Libra is the brainchild of Meta Platform. However, based on many insider reports, the initiative is looking to sell its entire asset and pay investors back their capital.
Diem Might Find Itself A Bunch of Buyers
The sources confirmed that Diem has been meeting with several investment bankers to evaluate the best approach to auction its intellectual property. After that, they can now cash out the estimated value reached and then pay it back to investors. However, it still remains unclear what the company’s estimated value will be since there are no guarantees that they will get a reasonable buyer.
Banking on the information received from insider sources, Meta owns about one-third of the crypto initiative. The remaining two-thirds are owned by the majority of members of the initiative including partners such as Shopify, Coinbase Global, and Uber.
Controversies around Diem
So many controversies have previously surrounded Diem in its short life. In fact, many spectators won’t be surprised at this new development given the many disputes that surround the project. Diem was initially launched on June 18, 2019. And going by the name Libra at that time, the project was hoped to be protected by a group of companies located in Switzerland. The companies went by the name Libra Association and looked to be committed to the project.
However, when news of the project’s launch reached the general public, many were triggered by the idea of the project. The project also witnessed rapid pushback from the United States regulator and government. The U.S. regulators cited concerns for privacy and money sovereignty as credible reasons to push back the project. To clear the air, both David Marcus and Mark Zuckerberg had to make an appearance before the House Financial Services Committee to testify and address regulators’ concerns.
During one of the hearings in July 2019, Sherrod Brown, Senator of Ohio inquired of Marcus if he really thinks the general public can trust Facebook. Especially with their money.
Marcus’ response was smooth and precise explaining to the senator that failure to act could be detrimental. Marcus believes that a virtual currency could be created by others outside the country and that would be more difficult to control.
The ruling was eventually ruled against Libra and many investors jumped ship and abandoned the project. With the ruling against the firm, the company rebranded and changed its name to Diem with the hope of shaking off the regulatory panic.
At its inception, Libra was developed to be a single coin that is paired against several currencies to ensure its stability. The idea behind Libra later evolved to also provide several coins that would each be supported by various currencies. According to the firm, those coins will complement rather than replace domestic fiat currencies.
Libra received major pushback from the US government and regulators have given two primary reasons. First, because the project is a brainchild of Facebook. Secondly, because of the project’s ambitious goals which seemed to threaten the conventional financial system.
However, in a bid to show the general public that the project has the capacity for organizational independence, Libra went through some major rebranding. This rebranding birthed the company we now know as Diem today. Libra Association, the independent firm behind the Libra project also changed its name to Diem Association.
According to the firm, the Diem project will offer a decent platform that will help fintech innovations to flourish. That’s not all, the platform was aimed to help businesses carry out transactions instantaneously at a low cost using a very secured network.