I needed to reinstall the driver twice, before things work fine.
You may want to do the following:
1. Uninstall displaylink driver completely; no other past versions are installed. Use the uninstaller of the latest driver.
2. Restart.
3. After restart, osx should not detect your monitor. Open system preferences, go to security and privacy, unlock the lock icon at the bottom left. Leave this window open.
4. Make sure that the allow apps downloaded in the security and privacy window does not show anything preventing displaylink. If there is any, then allow it.
5. Install the displaylink driver.
6. Leave your monitor plugged in.
7. Restart.
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