Meta: Crypto project was cursed right from the start

Everything that Metas digital currency project could have made a success, explains why it was doomed to fail. The parent company of Facebook has more than 2.9 billion monthly users, sits at $ 58 billion in cash and marketable securities and has a marketplace that is prepared for transactions that handle the traditional financial system. Its size is a serious challenge for the status quo.

is strange that Meta has not foreseen this. It hoped that it would prove by working with other organizations and obtaining approval by the regulatory authorities that this was not a data robbery. But the proposal of a new global digital currency separated from the central banks was a potential threat to the dominant role of the US dollar in the global currency.

The project, which was first announced in 2019 as Libra (now diem), was planned as a large association of companies, including Visa and PayPal, which was commissioned to build a blockchain and the management of a new global digital currency. The coin, supported by a number of Fiat currencies and securities, should avoid volatility that is struggling with the world's largest cryptocurrencies.

Nevertheless, it would have been a challenge to convince the users to accept a new payment method. Less than a fifth of the Americans have dipped their toes in cryptocurrencies.

The hostility of the supervisory authorities stopped the experiment. But for Meta and the crypto community, the failure is not a critical blow. The sale of assets to the crypto -enthusiastic Bank Silvergate for $ 182 million is a comfortable exit. The proceeds go to the association.

The Silvergate share price has halved since its high last November. The share of the transaction corresponds to about 4 percent of the bank's outstanding shares. Silvergate plans the output of a dollar-supported stablecoin, which indicates that association members can get involved in digital coins.

There are two unintentional consequences: Meta has encouraged the central banks to accelerate their own plans for digital currencies and to focus the supervisory authorities - mainly against the presentation of stable coins not issued by banks. Issuers like Tether can expect a closer examination of the reserves.

The downfall does not promise anything good for Metas Meta-Verse plans for virtual reality. But these are connected to digital advertising, a market that she gives. Nevertheless, Meta tried to work with the system just to push against a wall. The old Move Fast and Break Things model must look appealing.