Facebook’s Crypto Project Diem Announces Partnership with Silvergate Bank

Washington, DC – Facebook owned Diem Association announce a partnership between its wholly owned subsidiary Diem Networks US and Silvergate Capital Corporation . As part of this partnership, Silvergate Bank (“Silvergate”) will be the exclusive issuer of Diem USD Stablecoin. The Association also announced a strategic change in the US that would result in the relocation of Diem’s ​​core business from Switzerland to the US.

Diem is building a blockchain-based payment system to support financial inclusion and innovation in responsible financial services. Silvergate becomes the exclusive issuer of Diem USD Stablecoin and manages Diem USD Reserve. Diem Networks US will operate the Diem Payment Network (DPN), an official blockchain-based payment system that enables stable real-time transfers of Diem coins between approved network participants. Building this partnership is an important step in preparing for the Diem USD pilot project.

“Silvergate is a leader in financial innovation and an ideal partner for Diem as we develop a blockchain-based payment system that protects consumers and improves the health of the financial system,” said Stuart Levy, CEO of Diem. “We are committed to a secure payment system for consumers and businesses, making payments faster and cheaper, and using blockchain technology to improve the financial systems of more people around the world. We look forward to working with Silvergate to create this shared vision. reality. “”

“We believe in a stable dollar-backed coin future and its potential to transform existing payment systems,” said Alan Lane, CEO of Silvergate. “We are inspired by Diem’s ​​technology and commitment to building a payment system that complies with legal requirements and provides a safe way to move money. We are pleased to announce this product with confidence and look forward to continuing it. Working together to bring it to market.” “

In line with building on this partnership, Diem simplified his plans to issue a stable Diem USD coin by shifting his main activities from Switzerland to the United States. These changes are consistent with Diem’s ​​initial strategic focus on the United States and reflect Diem’s ​​reflection on the changing regulatory environment for digital currencies in the United States.

As a result, Diem withdrew a license application for the payment system from the Swiss Financial Market Supervisory Authority (FINMA), as a FINMA license was not required for the new model. Silvergate is the state bank of California and a member of the Federal Reserve. Diem Networks US will register as a cash services company with the US Department of the Treasury’s Financial Crime Network.

“Although our plans to take the project completely within the US regulatory arena and no longer require a license from FINMA, this project has benefited significantly from the intensive licensing process in Switzerland and the constructive feedback from FINMA and the more than two dozen other regulators around the world that are being held. by FINMA to review the project, “said Levy.

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