Diem, formerly known as Facebook’s crypto Libra, is migrating to the US Territory from the Swiss. Silvergate Bank has revealed a new launch strategy under whose auspices Diem’s development is taking place.
A new partnership agreement has been executed between Silvergate Bank and the Diem Networks US. The execution of the agreement was re-affirmed by Diem Association on 12 May 2021.
While Silvergate is a US chartered bank but on the other hand, Diem Networks is a subsidiary of the Diem Association. Diem Association intends to register Diem Networks with the US Treasury as a company that will be involved in the business of “money service”.
As per the partnership arrangement, it is glaringly evident that the exclusive issuer of the Facebook-crypto namely Diem will be Silvergate. Since Diem is going to be a stablecoin, therefore, Silvergate itself will also manage the reserve for Diem.
It was further informed by the Diem Association that it is planning to shift the operations of Diem to the US. Otherwise, initially, the operations were taking place from Switzerland.
It has been further apprised that the task of running the Diem Payment Network has been entrusted to Diem Networks, under the agreement. Diem Payment Network is a payment system that is based on blockchain and will be utilized by Diem.
The upcoming Diem project is very popular in social media, as Facebook – a social media giant, has promoted it.
This Diem Payment Network is said to be an easily accessible platform. The network claims that the services can be accessed even by an entry-level internet-enabled cellphone or device.
Alan Lane who is the CEO of Silvergate commented that the bank is a strong believer in crypto and stablecoins. He stated further that the future of the US’s financial system would be heavily dependent upon stablecoin.
Meanwhile, Diem Association too made several comments. For instance, the Association was of the view that they are eager to work in the US under the guidelines issued by the concerned authorities of the US. The Association further revealed that now they are shifting operations to the US, therefore, they do not need any license from Swiss Authorities.