Five senators have called for the immediate closure of Facebook’s new cryptocurrency wallet just hours after it was launched in partnership with Coinbase.
Crypto skeptic Senator Elizabeth Warren was one of five who called on Facebook CEO Mark Zuckerberg to “immediately suspend” the project. In a letter sent to Zuckerberg on Tuesday, five senators wrote:
Given the scale of the scandals surrounding your company, we are writing to express our strong opposition to Facebook’s renewed effort to launch a cryptocurrency and digital wallet, now called “Deem” and “Novi, respectively.”
Diem is Facebook’s ambitious stablecoin project, formerly known as Libra, which has come under widespread scrutiny and regulatory hurdles over the years, resulting in a number of major partners withholding investments. Novi is the company’s crypto wallet designed to hold Diem tokens and other stablecoins.
On Tuesday, Novi launched a pilot project in the United States and Guatemala in partnership with Coinbase, which will provide cryptocurrency deposit services. The pilot will allow users to receive, send and receive Dollars Pax (USDP) through their Novi account.
On Wednesday, Coinbase CEO Brian Armstrong congratulated David Marcus, co-author and Diem board member, adding: “It takes a lot of persistence to ignore the haters and ship.”
The bow shot sounded from the office of Senator Brian Schatz and was signed by Tina Smith, Richard Blumenthal, Banking Committee Chairman Sherrod Brown and Senator Warren.
They stated that Facebook has repeatedly made informed business decisions to pursue “actions that harmed users and society at large,” adding:
“Facebook cannot rely on the governance of the payment system or digital currency when its current ability to manage risks and keep consumers safe is significantly inadequate.”
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In a letter from the company announcing the pilot project, Marcus said: “We intend to move Novi to the Diem payments network when it receives regulatory approval.”
The company has much higher ambitions than just a cryptocurrency wallet and stablecoin in the digital space. On Sunday, Facebook revealed plans to create 10,000 highly skilled jobs in the European Union over the next five years to build its own path.