Odaily Frontline｜Facebook hopes to launch cryptocurrency Diem and Novi wallet next year

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2020-12-08 18:19 (UTC+8)

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David Marcus hopes regulators will clear up their doubts.

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David Marcus hopes regulators will clear up their doubts.

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Summary:
David Marcus, head of Facebook Financial, said he expects both the cryptocurrency Diem and the Novi wallet to launch in 2021.
Before the recent name change, Diem was known as Libra and was governed by the Diem Association.
The Facebook-backed cryptocurrency initiative has faced massive criticism from regulators around the world.

Marcus said he wants regulators to stick to the "no doubts" approach to the project.

The head of Facebook's financial services unit said on Monday that he hopes regulators will stick to the "benefit of the doubt" principle for Facebook's plans to launch a cryptocurrency project and the ambition of a digital wallet.

Odaily Note: Doubtless is the refinement of the principle of presumption of innocence. The presumption of innocence refers to the presumption that the accused is innocent until proven guilty by trial. What Marcus means is that he hopes regulators will clear up their doubts about the project.

David Marcus, head of Facebook Financial (F2), said he expects both Diem and Novi wallets to launch next year.

At the Singapore Fintech Festival, in response to the question "The biggest change in the financial services industry in the coming year", Marcus said, "I hope we can participate in Novi and Diem and the major changes in 2021, waiting for regulatory approval."

Since its announcement last year, Facebook's cryptocurrency project has been on a rollercoaster ride, facing huge criticism from regulators, a scaled-down project vision and a rebrand.

Facebook's cryptocurrency project, originally known as Libra, is governed by the Libra Association, a group of companies. Facebook had planned to launch a wallet called Calibra that would allow users to send the cryptocurrency to each other.

The original Libra design was supported by a basket of currencies. But regulators have raised concerns, including Libra's possible impact on financial stability and concerns about data privacy and money laundering.

In April, the Libra Association scaled back its plans and said it would only offer a stablecoin backed by a single fiat currency, rather than a single currency backed by multiple currencies.

Last week, the Libra Association changed its name to the Diem Association. Earlier this year, Facebook rebranded its digital wallet Calibra as Novi.

Last month, the Financial Times reported that Diem, the cryptocurrency, could launch as early as January, citing three people familiar with the matter.

According to the Financial Times, Diem Association is currently awaiting approval from the Swiss Financial Market Supervisory Authority, as the organization is based in Switzerland.

Although Dime is described as a cryptocurrency, it is not like Bitcoin. It has a central organization behind it, something that Bitcoin doesn't have. It is also backed by fiat currency, which is also different from Bitcoin.

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"No doubt"

Marcus implored Diem and Novi to give Diem and Novi a chance from regulators, who have previously been harshly critical of the company’s cryptocurrency plans.

"I don't think all we're asking for is outright trust. I think all we're asking for is at least innocence."

He argued that Facebook could have built the cryptocurrency in a "closed fashion," allowing only users of two apps the company owns, WhatsApp and Messenger. But instead, Facebook formed alliances with other companies.

"In recent history, I think you'd be hard-pressed to find any other company that has done this: a company that actually builds something, puts a lot of resources into it, and says, well, we're going to drop what we're here for," Marcus said. We’re going to try to make it as open an ecosystem as possible. As competition is enabled on what we create, it’s basically a no-brainer to do that.”

Libra rebranded as Diem, will it be easier to get regulatory approval this time?