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Once again, the assumptions of the stable cryptocurrency of the Diem association are changing. The project initiated by Facebook is to act as a "temporary e-dollar". When the US central bank comes into play, the story of this controversial venture is set to end.
The vision of a stable cryptocurrency Diem is changing its face once again. Since mid-2019, when Facebook announced its plans to roll out a global stablecoin, we could see some twists. The name of the consortium behind the project (formerly Libra), the list of members supporting the project, the seat and the business foundations of the plan have changed.
Initially, a stable cryptocurrency was to be based on a basket of currencies that would cover 100% of the value of the issued tokens. Later, after the overwhelmingly reluctant response from financial regulators, Di ambm's ambitions shrank somewhat. The association announced the issuance of a stablecoin based on the US dollar. In May 2021, several details of the plan were revealed, pointing to the first banking partner - Silvergate, a state-licensed California institution.
At the Consesus 2021 conference, Christian Catalini, Diem's chief economist, presented another version of the plan. Commenting on the original vision of a stable cryptocurrency, he pointed out that it was "naive" and could not withstand the clash with the regulatory realities.
“We propose an approach similar to public-private partnership. We treat [Diem's dollar token] as a temporary venture with partners like Silvergate acting as issuers. But when the CBDC (Central Bank Digital Currency) comes out… We are the only stablecoin issuer that has publicly committed to withdrawing its own token and replacing it with CBDC, ”said Catalini, quoted by Coindesk.
The vision of a stable cryptocurrency Diem is changing its face once again. Since mid-2019, when Facebook announced its plans to roll out a global stablecoin, we could see some twists. The name of the consortium behind the project (formerly Libra), the list of members supporting the project, the seat and the business foundations of the plan have changed.
Initially, a stable cryptocurrency was to be based on a basket of currencies that would cover 100% of the value of the issued tokens. Later, after the overwhelmingly reluctant response from financial regulators, Di ambm's ambitions shrank somewhat. The association announced the issuance of a stablecoin based on the US dollar. In May 2021, several details of the plan were revealed, pointing to the first banking partner - Silvergate, a state-licensed California institution.
At the Consesus 2021 conference, Christian Catalini, Diem's chief economist, presented another version of the plan. Commenting on the original vision of a stable cryptocurrency, he pointed out that it was "naive" and could not withstand the clash with the regulatory realities.
“We propose an approach similar to public-private partnership. We treat [Diem's dollar token] as a temporary venture with partners like Silvergate acting as issuers. But when the CBDC (Central Bank Digital Currency) comes out… We are the only stablecoin issuer that has publicly committed to withdrawing its own token and replacing it with CBDC, ”said Catalini, quoted by Coindesk.