Key Takeaways:
- Political Shutdown of Diem: David Marcus asserts that U.S. regulators politically pressured Meta’s Diem stablecoin project to shut down, despite no remaining legal hurdles.
- Regulatory Backlash: Early hearings and opposition from key figures, including Treasury Secretary Janet Yellen, hindered Diem’s progress and led to its abandonment in 2022.
- Shift to Bitcoin: Marcus emphasizes that decentralized networks like Bitcoin are the future for global financial systems, citing lessons from the Diem experience.
David Marcus, former co-creator of Meta’s blockchain payments project Diem (initially Libra), asserts the initiative was terminated due to intense political pressure from U.S. regulators.
In a post on Nov. 30, Marcus described Diem’s demise as a politically driven act involving intimidation of banking partners, rather than a legal or regulatory failure.
How Libra Was Killed.
— David Marcus (@davidmarcus) November 30, 2024
I never shared this publicly before, but since @pmarca opened the floodgates on @joerogan’s pod, it feels appropriate to shed more light on this.
As a reminder, Libra (then Diem) was an advanced, high-performance, payments-centric blockchain paired with a…
Launched in 2019, Diem aimed to create a global payments system backed by a U.S. dollar stablecoin, attracting major players like Visa and PayPal.
Despite its potential to revolutionize payments, the project faced immediate scrutiny.
Two weeks after its launch, Marcus testified before Congress, addressing concerns about money laundering and consumer protection.
While Federal Reserve Chair Jerome Powell reportedly supported limited approval, Treasury Secretary Janet Yellen warned such action would be politically damaging, allegedly leading the Federal Reserve to discourage banks from collaborating with Diem.
In 2022, Meta abandoned the project, selling its assets to Silvergate Capital, which later faced financial troubles and declared bankruptcy in 2023.
Reflecting on the experience, Marcus highlighted the need for decentralized financial systems, advocating Bitcoin as the foundation for long-lasting, neutral, and unassailable global payment networks.
His comments resonate with broader debates about political resistance to cryptocurrency innovation.
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