David Marcus, now head of Facebook Financial or F2, testifying about Facebook's proposed digital currency previously known as Libra, during a Senate Banking, House and Urban Affairs Committee hearing on Capitol Hill in Washington, DC, July 16, 2019. The cryptocurrency was renamed Diem in December 2020.

Saul Loeb | AFP | Getty Images

Facebook should be given the "benefit of the doubt" by regulators in its ambitions to launch the cryptocurrency it backs and its digital wallet, the head of the company's financial services arm said on Monday.

David Marcus, the head of Facebook Financial, also known as F2, said he hopes both the cryptocurrency called Diem and the social networking firm's wallet Novi will launch next year.

"I hope that we get to participate with Novi and Diem and the big changes of 2021, pending regulatory approvals where we need to obtain them," Marcus said at the Singapore FinTech Festival, addressing a question on the biggest changes for financial services in the year ahead.

Facebook's cryptocurrency project has been a rollercoaster since it was announced last year, facing huge criticism from regulators, a scaling down of ambitions and a rebrand.

The cryptocurrency was initially called Libra and was designed to be managed by a non-profit consortium consisting of several companies called the Libra Association. Facebook had planned to launch a wallet called Calibra that would allow users to send this cryptocurrency to each other.

One Libra coin was initially supposed to be backed by a basket of currencies. But regulators raised a number of concerns from the impact Libra could have on financial stability to issues over data privacy and money laundering.

In April, the Libra Association scaled back plans and said it wouldoffer stable coins backed by just one nation's currency, rather than a single coin backed by several currencies.

And last week, the Libra Association changed its name to the Diem Association. Earlier this year, Facebook changed the name of its digital wallet Calibra to Novi.

Last month, the Financial Times reported that the cryptocurrency Diem is preparing to launch as early as January, citing three people familiar with the matter.

The Diem Association is currently waiting for approval from the Swiss Financial Market Supervisory Authority as the organization is based in Switzerland, the FT reported.

Marcus was not asked about this report specifically during the course of the panel.

Though Diem is described as a cryptocurrency, it is not like bitcoin which is perhaps the most well-known digital coin. It has a central organization behind it, something that bitcoin doesn't. It is also backed by fiat currency, again a point of difference with bitcoin.

The Facebook executive implored regulators, which have heavily criticized the company's cryptocurrency efforts, to give Diem and Novi a chance.

"I don't think what we are asking for is just immediate trust. I think what we're asking for is at least to have the benefit of the doubt," Marcus said.

He argued that Facebook could have built the cryptocurrency in a "closed way" only making it available to users of WhatsApp and Messenger, two apps that the company owns. But instead, the social network has entered a consortium with other companies.

"I think you'd be hard-pressed to find any company that has done this in recent history of actually building something, investing considerable amount of resources into it, and then saying ok, we are going to relinquish our power here and we are going to try to make it as open ecosystem as it can be and basically tie one or both hands in our backs when it comes to enabling competition on the very thing that we've created," Marcus said.

"I think all of those things that we've done which has created all kinds of complications in the execution of this vision is I think a good reason to give us the benefit of the doubt in terms of our intentions and what we plan to do here."

The push to launch Diem and Novi comes at a time when central banks are also exploring their own digital currencies. China has already begun some real-world trials of a digital yuan.

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Facebook hopes the cryptocurrency it backs will launch in 2021, top exec says - CNBC

Last year, when Facebook officials were hauled in front of Congress to defend their plans for a cryptocurrency called Libra, they arrived with a pitch about financial inclusion. With Libra, people anywhere in the world would have access to a common payment network, they said, whether or not they had access to a bank. All it would take was a phone and a Facebook account.

Representative Rashida Tlaib, (DMichigan) a member of the squad of progressive first-term lawmakers, had heard similar pitches before. Her Detroit district, the third-poorest in the country, is populated with the very unbanked people Facebook executives were describing. In the past, they had been promised faster tax returns, paycheck advances, or check cashing without a checking account. But these offerings came with little regulation, and often with excessive fees or interest rates. Now, here was Libra, a cryptocurrency that also seemed poised to fall through the regulatory cracks, backed by an industry with a lot of power and data. She wondered if this was the next iteration.

People dont realize that this is coming. I feel like a mama bear, and I have to watch out for what is coming for my district and my neighborhood, Tlaib says. Thats why she wants to talk with you about a thing called stablecoins.

Not familiar? Eyes glazing? Its a bit niche, for now. Stablecoins are a form of digital currency that, as the name suggests, hold a constant value. Thats what Libra is, technically, but there are many other flavors. Stablecoins might be backed by an actual currency or a basket of assets, or they might use algorithmic tricks to hold steady, but the point is that their price in, say, dollars, doesnt change. Its a promise. Stablecoins were initially used to help with buying and selling volatile cryptocurrencies like bitcoin. But increasingly, some stablecoins, like Libra, have been proposed for more common uses, like paying for actual stuff. Thats because they can be fast, easy to use on phones, and are, well, stable.

I feel like a mama bear, and I have to watch out for what is coming for my district and my neighborhood.

Representative Rashida Tlaib (DMichigan)

The problem is that stablecoins are not much more familiar to members of Congress and regulators than they are to you and me. In the Facebook hearings last year, everyone seemed to want Libra to be regulated, but the unanswered question was how. So this week, Tlaib introduced a bill, cosponsored by representatives Stephen Lynch (DMassachusetts) and Chuy Garcia (DIllinois), that offers a possible solution: requiring stablecoins that promise a fixed value in US dollars to be issued by banks. That, the legislators argue, constitutes taking a deposit, which is something only banks can donot tech companies nor the associations they set up to issue coins on their behalf.

That logic takes aim squarely at Facebooks stablecoin plans. This year, while we were worrying over social distancing and reproduction values, Libra went through major changes. Instead of a global, borderless coin backed by a number of currencies and assets, its now proposed as a series of coins for different places: a coin for Europe denominated in euros, a coin for the United States denominated in dollars, and so on. Thats given some relief to central bankers who were concerned that Facebook's currency would compete with their ability to control the local money supply. Libra also abandoned a plan to eventually let anyone build services on its network, a feature that raised money laundering concerns, in favor of a closed system controlled by its official members.

Oh, and there were a few naming tweaks along the way. Facebooks Calibra division, which is designing the companys Libra wallet, now wants to be called Novi. And earlier this week, Libra itselfboth the currency and the association that issues itbecame Diem. Got that? Novi deals Diem. Think of it as an effort to assert the projects independence from Facebookthough, as a reminder, the company did come up with the idea, built most of the technology, set up the association with close allies, and will likely provide by far the most users for whatever coins are eventually issued.

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A Member of the Squad Takes on Cryptocurrency - WIRED

The top U.S. banking regulator has confirmed that positive cryptocurrency regulation is coming in a matter of weeks, by the end of the Trump term. Its going to work for everybody, said the regulator, adding that the new regulation will make it easier for crypto investors to know how to invest, therefore attracting more institutional investors.

Acting Comptroller of the Currency, Brian Brooks, answered some questions about the upcoming U.S. cryptocurrency regulation in an interview with CNBCs Squawk Box on Friday.

Brooks is the administrator of the federal banking system and chief officer of the Office of the Comptroller of the Currency (OCC). The OCC supervises nearly 1,200 national banks, federal savings associations, and federal branches of foreign banks that conduct approximately 70% of all banking business in the U.S.

Regarding the new U.S. cryptocurrency regulation, Brooks said: Were very focused on getting this right. We are very focused on not killing this, and it is equally important that we develop the networks behind bitcoin and other cryptos as it is we prevent money laundering and terrorism financing. He elaborated:

Believe me, there is a balance here and its going to work for everybody theres going to be very positive messages coming out.

Brooks answer was in response to a question about a rumor that the Treasury Department may be rushing out crypto regulation before the end of the Trump term. Coinbase CEO Brian Armstrong voiced his concerns on Twitter on Nov. 25. He wrote: We heard rumors that the U.S. Treasury and Secretary Mnuchin were planning to rush out some new regulation regarding self-hosted crypto wallets before the end of his term. Im concerned that this would have unintended side effects.

What we do need is clarity about what is allowed, and so we need some guidance for example whether banks can connect directly to blockchains as payment networks, the answer has to be yes, explained Brooks, who previously served as the chief legal officer at Coinbase. He emphasized that some aspects of the new regulation will provide clarity around the nature of crypto assets.

While noting that its a dangerous world out there, the top banking regulator stressed:

Nobody is going to ban bitcoin. Nobody is going to ban some of these transmission technologies so I think its going to be a lot less bad than than people worry about.

When asked about whether he believes more regulation will benefit the crypto industry, the OCC chief said: I dont think we need 50 regulations instead of two, but what we do need is clarity about whats allowed.

He continued: We need some guidance, for example, about whether banks can connect directly to blockchains as payment networks. The answer has to be yes We need the answers about can banks custody cryptocurrencies so that institutions feel comfortable adopting. And you saw what happened when we gave that clarity.

Brooks was specifically asked whether people should expect new U.S. crypto regulation by the end of the Trump term. I think youre going to see a lot of good news for crypto by the end of the Trump term, he replied, adding:

So you have clarity across a variety of areas that I think youll be seeing just in the next 6 8 weeks, which will make it easier for crypto investors to know how to invest, to know how institutions can be in this asset class.

Those are the things that are driving prices at this point, he opined. You know it may have been a bubble two years ago, but with more clarity, institutions that see this as a real thing are going to adopt at scale, which theyve already started to do. So stay tuned.

Do you think the new U.S. crypto regulation will benefit the crypto industry and bitcoins price? Let us know in the comments section below.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Top US Banking Regulator Reveals Positive Cryptocurrency Regulation Coming in Weeks | Regulation - Bitcoin News

It may just be a coincidence, but Bitcoin emerged just a few months after the mighty Lehman Brothers filed for bankruptcy in September 2008, heralding the Wests Great Recession and eliciting a great gush of liquidity from central banks that sceptics saw as an overstretch of fiat money. The big flaw of a currency unbacked by any valuable, in their view, was its vulnerability to oversupply and thus eventual loss of purchasing power. Like gold, might value not be retained more reliably by a token-of- exchange whose scarcity was insulated from fallible human intervention? It is not clear exactly what motivated Bitcoin, a privately-created cryptocurrency based on blockchain technology that is reputed to have its supply restrained by its digital design, but its 2020 boom after the covid crisis began to spawn trillions of dollars of extra cash has been too spectacular to ignore. On Monday, it hit an all-time peak of $19,800 per unit, surpassing its previous high of 2017. It is up by 140% so far this year and could be headed higher still.

Bitcoins vertiginous rise is not difficult to explain. In essence, it reflects investor dissonance with frenetic cash creation by central banks, globally. While it does have a few rivals, this cryptocurrency appears to have the pioneers advantage. It is seen not only as a reliable store of wealthperhaps in the same league as goldbut also as a hedge against the inflationary risks of monetary-easing policies that may have gone overboard, as some seem to suspect. With economies reeling under the pandemics fallout on commercial activity, risk-free bonds offering negligible returns (if any), and so much investment money chasing so few safe assets, it was perhaps inevitable that Bitcoin would attract large sums. Its value hinges on its much-touted supply limit. Its software rules are said to specify that only 21 million coins will ever be minted, with a widely-accessible online ledger keeping account. New units of it need to be mined" digitally, a long process that devours electricity and requires e-puzzles to be cracked. Given the claimed cap on Bitcoins final count, its minting rate has been set for a terminal decline: the number that miners can win halves every four years. This last happened in May, when the pace of tokens entering circulation fell to 6.25 every 10 minutes from 12.5.

The Bitcoin phenomenon may have ridden its way up on investor conservatism at the very opposite end of modern monetary theory", by which money can limitlessly be issued until inflation breaks out, but central banks may be forced to reckon with it soon. While their initial response ranged from dismissal to denouncement, it now seems here to stay. Yet, its success should dismay us. Like gold, it serves no clear productive purpose. It is used by shady operators on the dark web, remains highly volatile, and has highly concentrated holdings. It could plausibly stay this way till 2140, when the last token is scheduled for mining. But, as Indias apex court ruled, there is no reason to ban the buying and selling of cryptocurrency. Central banks, however, may need to be more vigilant of their currencies real value, especially as Facebook seeks the approval of Swiss authorities for Libra, a stablecoin" backed by the US dollar that it expects to launch in January. They may want to launch virtual money of their own, as the European Central Bank and others have proposed. What seems at stake here is the future of money, sovereign control over which is considered integral to economic management. But let regulation not scotch innovation.

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We made thelatest news on Facebooks Libra cryptocurrency initiativeone of the lead stories in last weeks bulletins, which may have seemed a bit of a niche pick. The initiative, which was renamed Diem shortly afterwards, could finally get its cryptocurrency out in the wild early in 2021,having announced it in June 2019.

One reason its interesting to Music Ally is the involvement of Spotify as one of its founding members, with CEO Daniel Ek havingsuggestedthat the initiative could eventually enable allowing users for instance to be able to pay artists directly a user in Japan might pay a creator in Argentina. And that opens up huge opportunities for how we can further our mission.

With that in mind, check outthis job advertisementfor an associate director, payments strategy and innovation at Spotify, based in its London office. Well, as based as any job can be in an office in the present times. The role will include leading Spotifys activity within the Diem initiative, but also

You will drive further consideration of new opportunities and innovation in the emerging ecosystem of distributed ledger technology, blockchains, cryptocurrencies, stablecoins, Central Bank Digital Currencies (CBDCs) and other digital assets, it explains.

Its no surprise that Spotify is kicking the tyres of blockchain technology: three and a half years ago it first signalled its interest in that area with theacquisition of a startup called Mediachain Labs. Meanwhile, every global digital subscription service (be it music or other things) is watching the crypto / digital payments space carefully at the moment. And in Spotifys case, hiring someone to figure out exactly what to do with it.

Stuart Dredge

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Spotify is exploring the digital asset and cryptocurrency space - Music Ally

In brief

Murat Pak, an award-winning 3D motion designer from Turkey, has become the first artist who has sold blockchain-based works of art for more than $1 million in total, according to analytics platform CryptoArt.io.

The platform tracks artists and their creations across the largest crypto art marketplaces such as SuperRare, Nifty Gateway, MakersPlace, and Async Art. These encompass the bulk of the blockchain art scene.

According to CryptoArts data, 268 of Paks artworks across various platforms have been sold to date for $1,079,382 (or 1,881 ETH) combined.

So grateful for this milestone. It is not always possible to plan the path to success. Sure, I work hard and do my best, but sometimes things beyond our control are a lot more important - as with Cryptoart, Pak tweeted today, adding, Sometimes the planets are lined up correctly.

Among the top three highest-grossing artists, Pak is followed closely by pseudonymous artists Hackatao and Xcopy, each selling their numerous artworks for a total of $803,224 and $656,474, respectively.

My inspiration generally comes from either simple moments or from music. The simple moments have great potential to carry more importance than they seem to. I have tried to keep the ideology behind all my work simple and effective, Pak previously told IdN Magazine.

In the past, he studied design, visual communication, and communication theories, and is currently working toward PhDs in New Media, Design, and Interaction/UX. By Paks own admission, he didnt exist prior to becoming a designer.

Over the past years, Paks artworks have been featured on Vimeo, IdN, OFFF, Motionographer, GraphicDesign, Fubiz, Designcollector, Shots, Stash, Computerartsin addition to numerous magazines and festivals.

As Decrypt reported, the popularity of blockchain-based artdigitalized in the form of non-fungible tokenskeeps growing exponentially. Just yesterday, 17-year-old artist Fewocious sold one of her crypto artworks for $21,350. She is also ranked 18th in CryptoArts top-grossing artists list, earning $171,934 for her creations in total.

How long before theres a swathe of crypto art millionaires?

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Cryptocurrency Artist Becomes the First to Earn $1 Million - Decrypt