Diem Might Be Dead But Facebook Is Not Done With Crypto

Diem might be dead but Facebook is not done with crypto yet as we can see more today in our latest cryptocurrency news.

Facebook announced its huge crypto plan back in 2019 which was a borderless global currency called Libra that was supposed to be backed by a collection of low-volatility assets and currencies from stable and reputable central banks. On the same day, Facebook also announced a wallet called Calibra to hold the Libra stablecoin. Two years later, Facebook rebranded to Meta and Libr to Diem but now it seems that Diem is selling off all its assets.

Diem might be dead now and could mean an end to a project that everyone saw as doomed from the start. The only product Facebook actually launched was the Noviwallet but it can only store the Paxos Stablecoin since Diem was not launched. But what did Facebook do wrong? For starters, the stablecoin was not decentralized despite Facebook insisting Libra was actually overseen by the Libra association. Four months after announcing it, the Association lost eight founding members like PayPal, MasterCard, Stripe, and eBay. It was quite hard for FAcebook to argue that Libra is not just a Facebook thing when it put down an executive in charge of it and that was David Marcus who was the head of Facebook Messenger.

Libra’s whiff on centralization wouldn’t spell doom for the project on its own. Critics pointed out that three leading stable coins are all centralized like Tether and Circle’s USDC and Paxos’s USDP. Facebook’s stablecoin announcement was a watershed moment according to Coin Center Executive director Jerry Brito. Despite all that, there was one fact that suggested Libya still needs 2 billion users to succeed. This base makes it hard for any product to fail and if Libra could just get out the starting gate with some larger amount of people are starting to try it the political hurdle is too high.

It’s tempting to declare that this is the end of Facebook’s ambitions but this is not right. It has gone all-in the metaverse and now it has seen the days as a crypto thing even though it wasn’t as accurate. The concept of the metaverse dates back to the early 90s with Neal Stephenson’s Snow Crash with games like Second Life and Animal Crossing were pre-crypto but the rise of the metaverse games that use blockchain and NFT blurred the lines.

Facebook was so desperate to show that it is all in on the metaverse and it even changed its name to META but its stock got down by 5% since the rebrand and renamed Oculus to Meta Quest. Meta’s stablecoin is now dead but don’t expect it to give up on crypto just yet.