Libra Changes Name to Diem, But Risks for the Cryptocurrency Market Remain

Libra Is No Longer Libra, But Risks for the Cryptocurrency Market Remain

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Facebook announced the renaming of its Libra cryptocurrency. It will now be called Diem. But the trial launch date probably remains the same – January 2021.

“Facebook is covering tracks on the eve of the launch of its coin,” – experts of the cryptocurrency market say. The fact is that the launch of the cryptocurrency of the largest social network can completely collapse the market. Facebook creator Mark Zuckerberg undertook to implement the idea of the genius Pavel Durov – to launch a cryptocurrency in the messenger. This approach provides a huge capitalization in a short time, because all the users of the messenger become the users of the cryptocurrency. This is exactly what Pavel Durov tried to do when he created his darknet TON with the cryptocurrency Gram. Durov himself said that the popular messenger Telegram was only the first stage of this project. TON could be the fastest and most popular cryptocurrency. But, unfortunately, under pressure from the American authorities, Durov was forced to abandon the project.

Zuckerberg used Durov’s approach to launching a cryptocurrency and also tried to get out of the US Securities and Exchange Commission (SEC) oversight by transferring the functions of launching the cryptocurrency to a non-profit organization in Europe. The coin was originally called Facebook Coin. It was later renamed Libra. The Calibra wallet was created for it. The launch and regulation was supposed to be carried out by the Libra Association with headquarters in Switzerland. A year ago, a successful test launch of Libra took place. However, the powerful American banking lobby intervened again. Zuckerberg was summoned to a Congressional hearing, from which he came out red and confused. He was urged to postpone the launch of the cryptocurrency.

The concern of American bankers is understandable, because Libra immediately receives a user base of almost 4 billion people around the world, due to users of WhatsApp (1.5 billion), Facebook Messenger (1.3 billion) and Instagram (1 billion). Libra is a stablecoin pegged to a basket of leading fiat currencies – the dollar, euro, yen and pound sterling.

Mark Zuckerberg did not dare to oppose the will of Congress, but continued to promote his project. In May, after Durov announced the termination of the TON project, the Calibra wallet was rebranded. It is now called Novi. Now Libra is renamed to Diem, and accordingly, the Libra Association is called Diem Association. The Association stated the rebranding is made due to negative feedback about the first version of the cryptocurrency. But they remain convinced that the solution itself is “a trusted, innovative financial network for people and businesses around the world.”