Libra, Deem, then nothing. Meta (Facebook), which launched the digital currency project with great fanfare in 2019, has abandoned the project. Mark Zuckerberg’s social network had in mind the launch of a virtual currency, called Libra, and then Diem, to offer a new payment method faster than an instant message outside of traditional banking circles. This was without taking into account the protest from central banks, regulators and policymakers who were concerned about risks to the stability of the financial system, anti-money laundering and protection of personal data.
Meta renamed its project Diem at the end of 2020 after the defection of several partners such as PayPal, Visa and Mastercard. A technological block that seemed inseparable from the futuristic metaverse on which the social network lays the package… three questions to clarify this announcement.
Does abandoning Diem call into question the Metaverse Project?
“As far as I know, Diem is dead,” analyst Rob Enderle told AFP. For him, Facebook’s reputation has reached a point where “they will have a very hard time doing something big”. However, Mark Zuckerberg unveiled his metaverse project at the end of 2021, launching the first technology bricks in the US and Canada under the name Horizon Worlds. “This fight over virtual currency is lost but they hope to come back strong with the metaverse,” analyzes Sajida Zouari, an engineer and blockchain expert who was counted among the 40 most influential women in France in 2019 according to Forbes.
The social network is trying to rebuild its reputation with users, by changing its name, and attracting younger generations thanks to the metaverse. “Meta has more legitimacy in the metaverse than in the crypto space. Virtual reality is an important backbone in the conquest of the metaverse and Oculus, which specializes in virtual reality headsets,” continues the specialist. Virtual reality technologies are the key to creating an immersive experience in the virtual universe. With the explosion of digital uses during the health crisis, the metaverse could become a new form of interaction. Social Network 3.0.
Isn’t virtual currency one of the basics of metaverses?
The metaverse is not without cryptocurrencies and NFTs (non-fungible tokens). Cryptocurrencies to buy virtual goods that are sold in the form of digital tokens. So what can we do without Diem? In fact, Facebook does not need to offer an internal virtual currency to create its global virtual world. “In the metaverse, we have access to many payment methods: virtual currencies, cryptocurrencies, and even traditional payment methods,” Sajida Zouari insists. The user experience will change but the virtual world can integrate any financial service. Finally, Facebook returns to its core business: the social network.
Is this good news for our personal data?
If Diem’s virtual currency had seen the light of day, it would have been another tool for collecting users’ personal data. Facebook (Meta) had access to the financial behaviors of its users, in addition to everything else. But with the metaverse, it’s even worse. “Facebook will create a virtual world in which it will collect an unimaginable amount of personal data that it can exploit with impunity,” Sajida Zouari worries. We don’t even have time to rejoice at Deem’s failure at the emergence of the metaverse. It’s like Hydra: in the face of an organization as powerful as Facebook, when you cut Upside down, it’s pushing two more back.” In the metaverse, the user can buy a house, land, have access to services. Not counting managing its virtual identity with avatars, kind of an extension of ourselves. Meta will pick up more information about its users and get richer.