Meta's encryption Avengers: From the ruins of Libra to the new battlefield of stablecoins

Original Title: Exclusive: Meta in talks to deploy stablecoins three years after giving up on landmark crypto project

Original authors: Leo Schwartz and Ben Weiss

Source text:

Compiled by: Daisy, Mars Finance

Meta abandons its milestone cryptocurrency project three years later and is now in talks for stablecoin deployment.

In 2019, Meta announced an ambitious plan: to launch a new cryptocurrency that could be used across Facebook, WhatsApp, and numerous digital platforms. However, under strong opposition from legislative bodies such as the U.S. Congress, the company ultimately shelved the plan. Now, Meta is once again probing the cryptocurrency space. According to five insiders, the company is discussing the introduction of stablecoins as a payment settlement tool with cryptocurrency firms and has hired a product vice president with crypto experience to lead the negotiations. These five insiders, whose identities have been confirmed by Fortune magazine, requested anonymity to discuss business secrets.

Meta declined to comment.

Stablecoins, as a value-preserving cryptocurrency pegged to the US dollar, have long been a popular product in the blockchain industry. However, the Biden administration’s strong anti-crypto policies have restricted their mainstream application. Nevertheless, with Trump’s election last November and payment giant Stripe’s recent acquisition of stablecoin startup Bridge for $1.1 billion, the application of stablecoins in broader financial fields is being activated—especially in cross-border payment scenarios.

In the past month, Visa announced a partnership with stablecoin infrastructure provider Bridge, financial company Fidelity revealed that it is developing its own stablecoin, and Stripe launched a new type of financial account based on stablecoins.

Meta’s interest in this technology reflects the growing demand for stablecoins from non-crypto enterprises. Currently, the U.S. Congress is reviewing two bills aimed at regulating stablecoins, which may end years of regulatory uncertainty in the field.

Meta’s cryptocurrency layout

According to LinkedIn, Ginger Baker joined Meta as Vice President of Products in January this year, specializing in fintech and payments. She previously held an executive position at fintech company Plaid and currently serves on the board of the cryptocurrency company Stellar Development Foundation, which operates a Layer-1 blockchain. Sources say she is leading Meta’s exploration into stablecoins.

Meta refuses to arrange an interview for Baker.

Meta has approached a number of crypto infrastructure companies earlier this year, according to three people familiar with the matter. The discussion is still in its early stages, but it focuses on the core advantages of stablecoins over fiat currencies – the ability to make low-cost payments to individuals in different regions, and to avoid traditional methods such as wire transfers, which are high-rate.

An executive from a certain cryptocurrency infrastructure company speculated that Meta’s Instagram may integrate stablecoins to issue small payments of around $100 to content creators in different markets, which would save on transaction fees compared to fiat payments. They described Meta as being in a “learning mode” and pointed out that the company may have an open attitude towards various types of stablecoins rather than being locked into a single product like USDC. Two other executives from cryptocurrency firms also confirmed to Fortune that they have had preliminary discussions with Meta regarding payment use cases.

Meanwhile, stablecoin issuer Circle poached Matt Cavin from gaming blockchain company Immutable in March. People familiar with the matter said it was spearheading talks with tech giants such as Meta. Cavin’s LinkedIn profile shows that he is currently the head of Circle’s “first-tier strategic partner”, but did not disclose the specific partner company.

The explosion of stablecoins

Meta’s exploration of stablecoins is particularly noteworthy, as it was once the most prominent tech giant to enter the cryptocurrency space. In 2019, Meta’s blockchain initiative evolved into the Libra project—a consortium formed by companies like Uber and PayPal, aimed at launching a stablecoin backed by a basket of fiat currencies. After renaming the project to Diem, Meta abandoned it in early 2022 due to regulatory pressures and sold its assets to the pro-crypto bank SilverGate.io.

Former employees who participated in Libra later founded cryptocurrency companies, including David Marcus, the founder of Bitcoin payment infrastructure company Lightspark. Other former employees transformed Meta’s technology to independently develop blockchains, the most notable being the founders of the public chains Aptos and Sui, both of which utilize the Move programming language developed by Meta.

According to a video obtained by Fortune, Facebook founder and CEO Mark Zuckerberg attended a Stripe conference on Tuesday, where he acknowledged the failure of Diem during a conversation with co-founder John Collison: “That project is dead.” When asked about Meta’s characteristic of always being the first to bet on technology trends, Zuckerberg stated: “Being ahead is certainly more interesting than being behind,” but he added: “We also have many cases of being a fast follower, and we are equally good at that.”