Remember when Facebook started talking about launching its own crypto coin two years ago called Libra and everyone balked and then it kind of went away? Well, it didn't totally go away, it's now called Diem, and the project is still moving forward toward a launch.
Libra began as a very ambitious project, with alleged backers that included Visa, Mastercard, Paypal, Uber, eBay, and Coinbase. The idea was for a so-called "stablecoin" that was tied to the U.S. dollar, and which would be funded by a consortium called the Libra Association based in Geneva, Switzerland. That was how it was all announced back in June 2019, but by the fall of that year, Visa, eBay, Mastercard, and other big backers were all announcing their exits from the Libra Association.
It's hardly been easy from a political or PR standpoint for Facebook to launch much of anything in the past few years, and the world is rightly skeptical of pretty much anything the company plots. But now that crypto coins are all the rage again, the Associated Press reports that Facebook's coin, and the renamed Diem Association, are still aiming to launch the currency this year, and they've moved the Association's base of operations out of Switzerland, to the U.S.
The name change apparently occurred quietly back in December, and the project has been scaled back considerably. Still, the Diem Association has 25 companies associated with it, including Uber, Lyft, and Shopify, and blockchain firm Coinbase remains onboard. Venture capital firms Andreessen Horowitz, Breakthrough Initiatives, and Thrive Capital are all in the consortium as well.
As the AP notes, the initial aim of Libra was to become a global currency to help the unbanked in developing countries around the world, allowing money to more easily be exchanged on platforms like WhatsApp. But the move to the U.S., following regulator pushback in the EU, marks a further scaling back for the Diem project.
Still, it's not clear what Facebook will do with Diem if and when it becomes a thing, or whether this could become yet another reason for Congress to cast a leery eye at the company's business ventures.
"A big step of our dialogue with regulators has been a phased approach to launch,” says Christian Catalini, Diem’s chief economist, speaking to CNBC. “We are going to be phasing in different functionalities and use cases, applications in different areas."
Previously: Facebook Unveils Details On Its Crypto Coin, Libra, And Its Plan To Track Every Dollar We Spend