US senators pressure Facebook to 'stop' crypto wallet program

Just hours after Facebook's new crypto wallet got launched with Coinbase, five American Senators have called for its immediate closure.

US senators pressure Facebook to 'stop' crypto wallet program

Just hours after Facebook's new crypto wallet got launched with Coinbase, five American Senators have called for its immediate closure.

One of the five senators who asked Mark Zuckerberg to "immediately discontinue" the project was crypto skeptic, Senator Elizabeth Warren. On Oct. 19, five Democratic Senators wrote to Zuckerberg:

We write to strongly oppose Facebook's efforts to launch a cryptocurrency and digital wallet, now dubbed 'Diem' and 'Novi,' given the scandals surrounding your company."

Originally known as Libra, Diem is Facebook's ambitious stablecoin project that has been the target of intense scrutiny and regulatory roadblocks for years. Several key partners have since withdrawn from the project. Diem tokens and other stablecoins can be stored in the firm's crypto wallet, Novi.

In collaboration with Coinbase, Novi launched a pilot in the U.S. and Guatemala on Oct. 19 that provides a crypto custody service. Using Novi, users will be able to acquire, send, and receive Paxos Dollars.

The CEO of Coinbase, Brian Armstrong, congratulated the board member and co-creator of Diem, David Marcus, noting that it takes a lot of resilience and perseverance to ignore the haters.

Sherrod Brown, Tina Smith, Richard Blumenthal, and Elizabeth Warren co-signed Schatz's letter.

In their statement, they said that the social media giant has repeatedly decided to pursue "actions that have harmed its users and the broader society by continuing to conduct such activities."

Until Facebook proves it is capable of managing risks and protecting consumers, it cannot be trusted to manage a payment system or digital currency.

There are far more ambitious plans in the digital space than just a cryptocurrency wallet and stablecoin. According to Facebook, 10,000 high-skilled jobs will be created in the European Union over the next five years in order to build its own metaverse.