Facebook has taken steps recently toward releasing its own cryptocurrency, which was previously called Libra. It was just announced that the coin has been renamed to Diem, to demonstrate greater independence from Facebook as a separate entity. The new name applies to both the organization and coin, so the Diem Association and Diem Dollar are gearing up for a 2021 launch.
Part of the rebranding was likely due to the pushback that occurred because of numerous reasons. Firstly, the fact that a global powerhouse like Facebook was releasing a cryptocurrency caused some concern among those who are already critical of the company’s dominating footprint. Secondly, the ambitious nature of the project set off alarm bells with its potential for overpowering central banks’ monopolies on fiat currencies. Thirdly, the controversial nature of the project and the regulatory headaches it faced scared off some big partners. Lastly, the major distrust of Facebook that Congress members displayed at a hearing last year when they questioned Facebook’s CEO dampened initial public enthusiasm.
The project’s goals seem to have changed along the path of its development as well. Initially, Facebook envisioned Libra as a cryptocurrency for mainstream use online and offline, just like fiat currency. The intention was that Libra would make it easier and faster to transfer money. Also, financial services could be offered around it by companies like Facebook. They even had a digital wallet called Calibra in the works, which has since been renamed as Novi.
It appears that Diem will launch in a substantially limited form as compared to initial goals. While exact details have not yet been finalized, it seems that it will be a single digital coin that is backed by the dollar. Originally, Libra was planned as a single digital coin that was pegged to multiple fiat currencies to enhance its stability. Later, it changed to a planned release of multiple digital coins that would be backed by a different currency.
The fears of its original big ambitions seem to have effectively reduced the project’s rollout in a major way, though time will tell what will ultimately be released. This story highlights the challenges that crypto projects encounter in general when releasing an initial digital coin. It is rarely a straight path to the finish line.
One major difference in this case is that it involves the household name of Facebook. Usually, when a new cryptocurrency project is launched by someone who is less well-known and who operates in a superior jurisdiction of regulatory agencies, the outcome looks very different. These situations tend to result in legal actions and defamation by the mainstream media.
While we applaud Facebook for taking steps toward expanding cryptocurrency into the mainstream, we see this as another agency regulated offering where privacy is non-existent when it comes to one’s transactions. META 1 Coin is a private coin trading on a private exchange that respects privacy. We encourage anyone considering buying coins on any public exchanges to evaluate the potential implications carefully.