NewsJun, 2021

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Facebook can truly build the first mainstream coin, thanks to its huge user base

With roughly 2.85 Billion active users, Facebook is a force to be reckoned with. The colossal user database, if introduced to cryptocurrency, can quickly speed up mass adoption. Probably that's what Facebook thought two years ago when they came out with their native coin 'Libra'. 

Facebook was all set to bring the revolution to the digital currency in 2019, but regulators came calling, and things went south from there. The Libra token was initially intended to use as a universal currency pegged to other fiat currencies like US Dollars and Euro. 

It met strong opposition, and significant investors like Visa and Mastercard backed out, forcing the project to nearly fold. As a result, the project changed direction and minimized its scope. 

Now called 'Diem', the Facebook coin is expected to be launched later this year though supply will be limited. It is reported that The Diem Association, the Switzerland-based nonprofit which oversees Diem's development, is aiming to launch a pilot with a single stable coin pegged to the US Dollar in 2021. The pilot will be small and only focus on individual consumers. However, it is highly likely it will be used to buy goods and services. 

Diem, then Libra, met with intense scrutiny when it first came to light. Given Facebook's broad reach, central bankers and financial institutions feared the currency could endanger monetary stability and possibly facilitate money laundering. Facebook's involvement also meant that there were concerns about data privacy as well.