Diem responds to allegations from Senate Democrats

Diem has penned a response to the group of Senators that called out Facebook, asking the social networking company to shelve its Novi and Diem offerings

On Tuesday, a group of senators wrote to Facebook CEO Mark Zuckerberg asking that his company abandons plans for its digital wallet, Novi. The wallet is intended to eventually custody the Diem token, though it is scheduled to launch with the PAX dollar token for its pilot program.

Diem has since responded to the letter, saying that the lawmakers had misread the relationship between itself and Facebook. Diem explained that it is not the same entity as Facebook, and it is instead an association with members from both Novi and Facebook. The project clarified that Novi’s scheduled pilot program had no relation to the Diem token as it would categorically use the Paxos stablecoin.

“Diem is not Facebook. We are an independent organisation, and Facebook’s Novi is just one of more than two dozen members of the Diem Association. Novi’s pilot with Paxos is unrelated to Diem,” a section of the statement read.

The response to the US senators also reviewed the senators’ protest that Diem had failed to show how it would prevent illegal financial transactions and crime on the platform. Diem Networks cited that it has been positively reviewed by the Treasury Department’s Financial Crimes Enforcement Network, reflecting Diem’s financial crime compliance framework. Diem also held the opinion that it has among the best controls in the industry; the prohibition of anonymous transactions to non-hosted wallets until their financial risks are managed.

“Beyond financial crime compliance, we engaged extensively with an interagency regulatory team about the design of the project. As part of that review, we made adjustments to reflect feedback we received, and we were informed by a senior regulator that Diem is the best-designed stablecoin project that the US government had seen,” Diem expounded on its position.

Diem additionally disclosed that when it eventually launches in the market, it would have considered the feedback from regulators worldwide. The project promised to offer a payment system that would be secure for users and protected from financial crime.

Since Facebook proposed it in 2017, the Diem stable coin has been facing constant scrutiny. This is not the first time US senators are questioning the project. The blockchain-based payment system was previously criticised in 2019 by Senators Brian Shatz and Sherrod Brown, who felt that Facebook engaged in financial activities without subscribing to the relevant regulatory requirements.

The senators had also complained that the project exposed consumers to high levels of risk. Once again, the danger posed by the project to users and the financial system is the primary concern expressed by the five Democratic senators. The quintet is asking Facebook to stick to its previous commitments not to launch a digital currency under improper regulatory circumstances. The senators maintain that the social networking company is not to be trusted in executing a payment system, let alone a digital currency.

The post Diem responds to allegations from Senate Democrats appeared first on Coin Journal.

Why Bitcoin Still Has A Long And Prosperous Road Ahead

With the current lull in price, it may seem that bitcoin is slowing down — but this is simply an illusion. Summary Of The Week Although bitcoin started climbing slightly over the last week of November 2021, it still hasn’t picked up the next leg of the current bull run. The recent dip saw many::Listen

With the current lull in price, it may seem that bitcoin is slowing down — but this is simply an illusion.

Summary Of The Week

Although bitcoin started climbing slightly over the last week of November 2021, it still hasn’t picked up the next leg of the current bull run. The recent dip saw many large HODLers accumulate more bitcoin, while several large mining firms once again confirmed their intent on HODLing the bitcoin they mine.

Interestingly, this week also saw reports emerge that large U.S. banks are eyeing the possibility of providing bitcoin-backed loans, and executives at the Korean Exchange are also showing interest in bitcoin. Let’s take a look at what happened this week in bitcoin.

Monday MicroStrategy Moves

The week started off on a bullish note. Thailand revealed plans that they may waive taxes on bitcoin for tourists in the country. Jack Dorsey announced his resignation as CEO of Twitter, leading many to believe he will focus on bitcoin after saying, “If I were not at Square or Twitter, I’d be working on Bitcoin” at Bitcoin 2021 earlier this year.

As predicted in my last post, MicroStrategy and the nation of El Salvador bought the dip, with MicroStrategy purchasing another 7,002 BTC, bringing their total holdings to 121,044 BTC. El Salvador, on the other hand, purchased another 100 BTC, bringing the country’s total holdings to 1,220 BTC.

Asset manager Invesco launched a spot bitcoin exchange-traded product (ETP) on the Deutsche Boerse under the ticker symbol BTIC.

Tuesday ETF Talk

Tuesday saw very little in terms of news in the market, except that Purpose Investments launched the first bitcoin ETF offering monthly yields in Canada. The U.S. Chairman of the Federal Reserve, Jerome Powell, said that the risk of more inflation in the U.S. was rising, which is likely to push more people into investing in bitcoin, the best hedge against inflation.

Wednesday Retailer Adoption

With the U.S. government rejecting several spot ETFs over the last month, Fidelity announced plans to list a spot bitcoin ETF in Canada pending government approval. Croatia’s largest retailer, Konzum, announced that they would start accepting bitcoin payments for online orders.

Jack Dorsey announced that Square would rebrand to Block Inc., while Square Crypto, which focuses on bitcoin, would be rebranded to Spiral. The company will reportedly focus more on blockchain technology going forward. It was also announced that their payments app, CashApp, would support bitcoin’s latest upgrade, Taproot.

Bitcoin node maker, nodl, launched Lightning Network–focused node aimed at merchants in emerging markets that wish to accept bitcoin payments.

Thursday Regulation Themes

Facebook announced that they would loosen licensing and advertising restrictions on companies that promote bitcoin exchanges and wallets, signalling an overall positive sentiment for the market moving forward. Yves Choueifaty, the founder and CIO of Tobam, said that it’s riskier to invest $1 million in the S&P 500 than $25,000 in bitcoin.

Korea Exchange (KRX) Chairman Son Byung-doo said the country needs to study embracing bitcoin and cryptocurrencies. For reference, KRX has 2,448 companies listed with a combined market cap of $2.6 trillion.

Canadian bitcoin miner Hut 8 announced that they had mined 265 BTC during November and intends on HODLing all of it, bringing the company’s total bitcoin holdings to 5,242 BTC. And finally, the Indian government announced plans to regulate bitcoin, instead of banning it.

Friday Freedom Backed Loans

Early on Friday, a report was released that Goldman Sachs and other Wall Street banks were exploring the possibility of offering bitcoin-backed loans, meaning individuals and companies would be able to take out loans providing bitcoin as collateral.

Bitcoin miner, Riot Blockchain, also revealed that they mined 466 BTC during November and intend on HODLing all of it and Marathon, another mining firm, announced it would expand its agreement with data center provider, Compute North, to add 100,000 miners in its predominantly solar- and wind-powered data centres.

Bitcoin History From This Week

On December 5, 2010, in one of his last posts on the BitcoinTalk forum, Satoshi Nakamoto pleaded with WikiLeaks not to start accepting bitcoin payments as they “would not stand to get more than pocket change, and the heat you would bring would likely destroy us at this stage.”

On November 28, 2012, the first bitcoin halving took place, at the time a single bitcoin cost only $12. On December 5, 2013, the first Chinese bitcoin ban was announced, which saw BTC China, the largest bitcoin exchange at the time, shut down. On November 29, 2017, bitcoin surpassed the $10,000 mark for the first time during the 2017 bull run, it would surpass $18,000 just 10 days later.

The Long And Prosperous Road Ahead

First off, as the end of November came and went, PlanB’s popular floor model was proven wrong, despite accurately predicting bitcoin’s price at the end of August, September and October all the way back in June. Of course, he said the stock-to-flow model is still on track and that bitcoin is still ready to moon during the current bull run.

Seeing U.S. banks interested in embracing bitcoin-backed loans is another interesting bit from this week, showing how bitcoin has proven itself as an asset that’s here to stay and banks simply can’t ignore that anymore. It remains to be seen if HODLers decide to opt for loans, but the more services available to them, the better.

While the U.S. government remains reluctant to approve spot bitcoin ETFs, plenty have been launched in Canada and Europe and the U.S. is slowly falling behind. It’s likely that, as more become available in other nations, the U.S. will make a u-turn and embrace companies hoping to both offer the funds and invest in them.

As I’ve said before, it was highly likely that MicroStrategy and El Salvador, both pioneers in their respective fields, would buy the dip. Their leaders appear to have a clear strategy in mind and it’s likely they will continue to buy future dips, just as they have this one. Their example should see many more adopt the same strategy, because apparently if we say so, it’s not convincing above.

Overall, more individuals, companies and even countries are embracing bitcoin. Whether it be through investment, favorable laws or just promoting its uses in general; bitcoin is getting more screen time than ever before. Despite the dip, the more coverage the better.

It’s likely that with the newly discovered omicron variant, the COVID-19 pandemic has no end in sight and its effect on the global economy will continue to hold. Inflation in some of the leading economies will continue, which will end up affecting developing nations, likely pushing more to follow in El Salvador’s footsteps.

There’s still centuries ahead for bitcoin to grow, despite bitcoin being over 11 years old by now, we’re still in the early days and there will be days where we yearn for being able to buy bitcoin at $58,000.

This is a guest post by Dion Guillaume. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.

Diem responds to allegations from Senate Democrats

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