Facebook's failed stablecoin project Diem won't be released under Silvergate Bank's wing this year, as the California-based bank is still facing regulatory difficulties.
In an interview with Axios, Silvergate Bank CEO, Alan Lane, said the bank wants to be sure that it's on the right track with its tokenized version of the US dollar:
"It's not a tech issue at this point keeping us from launching, but making sure we get it right with our regulators," he said.
Although Lane declined to detail on the difficulties the bank is facing with, he pointed out that Silvergate is not a consumer bank, and, therefore, it doesn't currently have a "method of broad distribution, like a big national bank does. Currently, Silvergate plans to distribute the stablecoin through its corporate clients:
"Uber, Shopify or Spotify. Any one of those platforms, they would be our customers. We would issue the tokenized dollar to them and they would distribute them to those users."
Silvergate purchased Diem in February this year, after Meta faced with regulatory bars on its way to become a digital financial institution. Although the price of the deal remains undisclosed, reports say Silvergate might have spent around $200 million on the deal.
