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The Facebook-backed digital currency project formerly known as Libra, says it is shifting operations from Switzerland to the US. Now called Diem, it has withdrawn its Swiss licence application.
Geneva-based Diem said it planned to launch a cryptocurrency tied to the US dollar later this year.
Diem said it was withdrawing its application for a payment system licence from the Swiss Financial Markets Authority FINMA. It has not yet been able to secure a licence from the Swiss financial oversight authorities.
“The project has benefited greatly from […] the constructive feedback from FINMA and more than two dozen other regulatory authorities from around the world convened by FINMA […]” Stuart Levey, Diem’s CEO, was quoted as saying in a Tweet from the company on Thursday.
FINMA flagged up the withdrawal in a statement on Wednesday evening.
The Diem Association, which includes Facebook and 25 other companies, said it had entered a partnership with Silvergate Capital Corp. to issue a “stablecoin” backed by the US dollar. A stablecoin is a digital currency backed by real-world assets such as national currencies or other commodities.
Facebook announced the Libra project in 2019, at the time envisioning it as a stablecoin based on a basket of national currencies. Since then, the effort has been scaled back considerably amid a regulatory and commercial backlash. It underwent a name change in December 2020.