Diem Stablecoin Distanced Itself From Facebook As It Launched Novi

The Diem stablecoin distanced itself from Facebook as it continued with the launch of the Novi wallet that we reported about in our latest Libra news.

Diem is a facebook-backed crypto project which responded to attempts by the United States Senate to halt the launch of its Novi wallet by distancing itself from the social media platform. The crypto project launched the Novi wallet and said it aimed to help people send and receive money abroad, in a fast, secure, and no-fee manner. However, this was met with some stiff opposition from the US lawmakers who wrote a letter to the CEO of the platform Mark Zuckerberg to discontinue the digital wallet project. But the Diem stablecoin distanced itself from Facebook, or so it claims.

In the letter signed by members of the US Senate Banking Committee, they showed that this is their biggest opposition to Facebook’s efforts of launching a cryptocurrency and a digital wallet while urging the platform to discontinue Novi pilot and to commit that FB will not bring Diem to the market. The Novi wallet continued despite the hostilities from the senate and got listed on Google App and Apple app stores for download. Diem responded to the senator’s letter stating that the legislators could have misunderstood the relationship between the stablecoin and Facebook while also saying that the social media entity were two entirely different organizations. According to the press release:

 “Diem is not Facebook. We are an independent organization, and Facebook’s Novi is just one of more than two dozen members of the Diem Association. Novi’s pilot with Paxos is unrelated to Diem.”

The press release noted that Diem’s blockchain-based payment system was built for payments and it prioritized consumer safety, financial stability, and has a goal to fight financial crime. The independence is designed to foster competition and interoperability in payments and while this could sound like a good thing, Diem is still linked to Facebook in more ways than one. For example, the stablecoin project is being led by one of the top executives of Facebook named David Marcus who is the social media giant’s financial head. The project is the brainchild of Facebook and was developed in 2018 before it got locked in a closet. Since then, the Instagram parent company made a few new partnerships to keep the project going.