Facebook cryptocurrency project moves its operations to the US

San Francisco (USA), May 12 (EFE News) .- The controversial cryptocurrency project promoted by Facebook and announced with great fanfare two years ago has significantly lowered its international expectations and will move its operations center from Switzerland to the United States, the Diem association reported on Wednesday. Diem is the successor to the digital currency that was announced at the time as Libra, but after receiving a lot of criticism from politicians and regulators around the world and seeing how several of its partner companies abandoned ship, the project was paused and its name changed.

The Facebook cryptocurrency project

During this time, Facebook has significantly lowered its leadership in the project, since the social network has gone from being the most visible face of the proposal in June 2019 to becoming only one of the 26 member companies through its financial subsidiary Novi. In a statement published on Wednesday, the Diem association revealed a «strategic change» to focus on the US market, which implies abandoning the procedures in which it was involved to obtain a payment system license from the Swiss regulatory body.

In the US, Diem will locate its new operations center in Washington, the capital, and will partner with the Californian bank Silvergate to issue in the future a cryptocurrency linked to the value of the dollar, known as “stablecoins”. This is also a significant departure from the original Libra project, which due to its global ambition was not going to be tied to a single currency, but was to be backed by a basket made up of bank deposits and sovereign debt from various countries.

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As indicated by the association, the new plans include registering Diem as a money services business on the list of the United States Government and allow immediate transfers between individuals through a system based on “blockchain” technology, with which the vast majority of digital currencies operate.

The Silvergate bank will be the exclusive issuer of Diem and will manage the reserves of the digital currency. After the departure of such relevant companies as Vodafone, PayPal, eBay, Stripe, Visa, MasterCard and Booking Holdings, the most prominent members of the Diem association today are, in addition to Facebook, Uber, Lyft and Spotify. EFE News