Facebook’s ambitious plans to develop its cryptocurrency seem to have officially come to an end. In 2019, the Diem Association was formed. Then, Facebook planned to build a futuristic payment network, mainly due to pressure from legislators and financial regulators, which never got off the ground. Read more about bitcoin selling and buying through trading platforms such as Bitcoin Loophole app.
Unsurprisingly, Facebook’s vast network of users and the company’s wealth of resources were seen as too significant a threat to governments’ economic power. Today, news broke that Facebook has sold the Diem Association’s technology to Silvergate Capital for $200 million.
Libra is proof that bitcoin is the only chance.
The exciting thing about Facebook’s project, which started under the name Libra, is that it shows the power of bitcoin. A company like Facebook is a legal point of contact for governments, and a government cannot call the CEO of bitcoin to tell him that the network should be taken down.
Bitcoin is decentralized and has no CEO or other point of contact. Libra has been an excellent example for many people to learn about the power of decentralization and the importance of a network that any power cannot overthrow.
Shortly after the plans for Libra were unfolded, Facebook received calls from Washington. Officials immediately warned of the dangers of Libra to financial stability, spoke out about privacy, and worried that the currency would be used for money laundering and terrorism.
Precisely it was the same arguments that are made when it comes to bitcoin. But the difference is that bitcoin does not care about that, and Libra no longer exists. As a result, many partners left the ship prematurely, and little remained of the project.
The plans with the Diem Association technology
What exactly Silvergate Capital wants to do with the technology of the Diem Association is not yet clear at the time of writing. However, in December of last year, it was already announced that Silvergate Capital would issue a dollar-backed stablecoin in collaboration with Diem.
It is interesting because Silvergate Capital is a party that provides many exchanges with the necessary financial infrastructure to keep their operations running and is An essential player in the bitcoin ecosystem.
The coming months should show what they plan to do with their $200 million purchase. Since it is a hefty amount, there must be value in the technology of the Diem Association. The Diem payment system can be used, among other things, to run stablecoins.
Tesla will also have more than $1 billion in bitcoin in cash by 2022
According to figures released on Wednesday for the fourth quarter, the value of Tesla’s bitcoin position did not change in the fourth quarter of 2021. The company has barely bought or sold and had a position of ~$1.26 billion as of December 31, 2021. in bitcoin.
This report means that the bitcoins entered into books for the same amount as at the end of quarter three.
The price has been $69,000 and $42,000 during the previous quarter. If the entire quarter were a candle on a chart, you would see a massive wick at the top and a small one at the bottom and then end up close to the same price.
Compared to the rest of the financial household, Tesla’s bitcoin position is modest. For example, at the end of quarter four, $17.58 billion in cash was held.
Michael Saylor and Cathie Woods
Tesla is disregarding the advice of Michael Saylor of Microstrategy. He advised Elon Musk in November to convert Tesla’s balance sheet to bitcoin. Financial director Phong Le said that “Microstrategy” itself made substantial purchases in 2021 and will continue to do so in 2022. He says about bitcoin that just like building a house where you want the foundation solid, Bitcoin is very durable and solid to trust for future investment.
If Musk is on the same page as Cathie Wood and her ARK Investment Management, Tesla may report that it bought the dip at the end of this quarter. ARK has published a preview with a bitcoin price in 2030 of more than $1 million.