Five senators, in partnership with Coinbase, have called for the immediate closure of Facebook’s new crypto wallet just hours after it was launched.
Cryptoskeptic Senator Elizabeth Warren was one of five who urged Facebook boss Mark Zuckerberg to “stop” the project immediately. In a letter to Zuckerberg dated October 19, the five Democratic senators wrote:
“Given the scale of the scandals surrounding your business, we are writing to express our strongest opposition to Facebook’s revitalized efforts to launch a cryptocurrency and digital wallet now known as the ‘Diem’ and ‘Novi’, respectively . “
Diem is Facebook’s ambitious stablecoin project, formerly known as Libra, which has been subject to rigorous scrutiny and regulatory obstacles for years, which resulted in a number of key partners pulling out of the project. Novi is the company’s crypto wallet that contains the Diem token and other stablecoins.
Novi, in partnership with Coinbase, launched a pilot project in the United States and Guatemala on October 19 that will offer crypto custody services. The pilot will allow users to purchase, send and receive Paxos Dollars (USDP) through their Novi account.
On October 20th, Coinbase CEO Brian Armstrong congratulated Co-creator and board member of Diem David Marcus, adding, “It takes a lot of perseverance to ignore the haters and the ship.”
The shot across the bow came from Senator Brian Schatz’s office and was co-signed by Tina Smith, Richard Blumenthal, Bank Committee Chairman Sherrod Brown, and Elizabeth Warren.
They said Facebook has repeatedly made conscious business decisions to “pursue actions that have harmed its users and society at large,” adding:
“Facebook cannot be trusted to manage a payment system or digital currency when its existing ability to manage risk and keep consumers safe has proven to be utterly inadequate.”
Related: One currency to rule them all: Facebook’s Diem has global ambitions
In a letter from the company announcing the pilot, Marcus stated, “We intend to migrate Novi to the Diem payment network once it has received regulatory approval.”
The company has far higher ambitions than just a crypto wallet and stablecoin in the digital space. On October 17th, Facebook revealed plans to create 10,000 high-quality jobs in the EU over the next five years in order to build its own metaverse.