Mark Zuckerberg's attempt to develop a cryptocurrency has crashed and burned.
The Facebook-sponsored cryptocurrency, formerly known as Libra, was launched in 2019.
Facebook set up the Diem Association to manage the digital token, and the association solidified partnerships with dozens of companies.
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The cryptocurrency initiative, which Mark Zuckerberg once defended in front of congress, looked promising on paper but ultimately failed to deliver on plans to build a futuristic payment system.
The Diem Association is now selling its technology to Silvergate Capital Corp, a small California bank in the crypto space, for an estimated $200m.
This is according to a report by the Wall Street Journal, which has not named the source.
Bloomberg previously reported that Diem was considering selling its remaining assets to reimburse the value to investors.
So what was this once ambitious project, and why did it fail?
What was the Facebook cryptocurrency Diem and why is the project coming to an end?
Facebook wanted Libra to help grow a global payment system that would provide universal access to a financial system.
The ambitious yet simple goal was soon shot down by regulators and traditional financial systems, which is why Zuckerberg was called to Congress to defend it.
Facebook Co, which recently changed its name to Meta, announced plans to create a "stablecoin" called Libra back in 2019. Its motto at the time was "move fast, break things".
Stablecoins are designed to have a stable price, by being linked to an existing currency. Libra was originally designed to be backed by a range of currencies and initially had a bunch of companies collaborating with it.
However, regulators weren't happy, and Zuckerberg was called to testify in Congress.
At the time, Facebook was under fire for misinformation on its platform, and all the bad press made its partners uneasy. Businesses started withdrawing their support.
To try and revive the project, Facebook rebranded the coin to Diem, setting up a separate association to handle it. The Diem token was linked to the US dollar and would typically be used to buy and sell other cryptocurrencies like Bitcoin.
This didn't work. Silvergate bank stepped in to be the issuer of the Diem stablecoin, but the US Federal Reserve said it wouldn't give it the go-ahead as it was "uneasy2 with plans.
With the risk of a Fed crackdown hanging heavy, the Diem coin essentially couldn't exist, and so the project started to unravel.
The Diem founder, David Marcus, also left Meta last year as a few of the team jumped ship.
