In a letter, the US banking committee Senators have vehemently opposed the revival of the stablecoin and wallet project of the world’s leading social media platform, Facebook.
Just a few hours had passed after Facebook’s launch of a pilot version in collaboration with a leading crypto exchange, Coinbase when Senators started handing in a letter of disapproval. There were around 5 Senators voicing their concerns regarding Facebook’s revival of its blockchain-based project.
In a letter, one of the five Senators, Elizabeth Warren, raised her concerns. She is known for her skepticism about crypto and wrote,
“Given the scope of the scandals surrounding your company, we write to voice our strongest opposition to Facebook’s revived effort to launch a cryptocurrency and digital wallet, now branded ‘Diem’ and ‘Novi,’ respectively.”Elizabeth Warren’s letter
Facebook looking to revive the stablecoin and wallet project
Facebook had decided to launch a stablecoin termed Libra which failed and is now rebranded as the Diem token. The plan for the release of this project saw a lot of hurdles and remarks from a majority of regulators for the past couple of years.
It seems that rebranding the project didn’t have any effect on the financial authorities, as they continue to remain dubious of Facebook’s activities and the crypto industry as a whole.
According to the social media giant, the goal of the wallet is to hold the yet-to-be-released Diem token as well as other stablecoins. The wallet was tested in Guatemala and the US on 19th October in collaboration with Coinbase. The social media platform could learn about the efficiency and demand of their wallet through this testing process.
Senators against the social media giant
There were 5 Senators who co-signed the letter, including Tina Smith, Richard Blumenthal, Brian Schatz, Sherrod Brown, and Elizabeth Warren.
“Facebook cannot be trusted to manage a payment system or digital currency when its existing ability to manage risks and keep consumers safe has proven wholly insufficient.”The Senators claimed in the letter
On the other hand, the social media giant’s partner in the project, Coinbase’s CEO, Brian Armstrong came out in support of David Marcus, the leader of the entire project.