The year 2021 seems to be a big year for the blockchain world as a number of projects like Nonfangible Tokens (NFT) and Centralized Decentralized Finance Exchange (CDFS) are moving to the central level. There is also the cotton of Facebook in the forefront.
Not too long ago, the media was overwhelmed by the news that the world’s largest social media network was planning a global digital currency. Then, after a while, it seems that Facebook has removed the plans for him. Disputes with regulators around the world were behind delaying and redirecting Facebook’s plans. Instead of backtracking, Facebook has decided to strategically launch a “different” global digital currency after 2021, after re-branding the project to Dime.
Related: New name, old problem? Re-exposing cotton to dim is still a challenge
It was different in the sense that their names and administration had changed. However, the Libra Association, later renamed the Dime Association in December 2020, will manage the project.
What is Facebook Dime?
Facebook Dime is a soon-to-be-launched unlicensed payment system based on blockchain technology. The system will have a stable coin known as Dime and run on its blockchain network.
Although Facebook proposed the project, the Dime Association will oversee the entire project in the interests of transparency. The Diem Association is an association of companies from various sectors of the economy, including technology, fintech, telecom, venture capital and non-profit organizations.
The primary currency, cotton, was not decentralized, nor was diem. Although the goal is to be unauthorized, the current plan is to run Dime in an approved blockchain. As a result, only members of the Diem Association can transact on it.
However, this is because the development team has not yet developed a robust solution that can handle unauthorized transactions for its billions of potential users. Enthusiasts are optimistic that this will change as the project progresses in the pipeline.
In the long run, Dime’s ultimate goal is to help the world gain easy and fast access to financial services. The US dollar, euro, British pound and other major fiat currencies will support the Dime project. If the project gets approval from U.S. regulators, Dime will act as a full-fledged central bank powered by blockchain technology. As you probably know, it is not something like Bitcoin (BTC) and others.
Related: Metavers: Mark Zuckerberg’s Brave New World
Facebook’s new global digital currency component
Facebook’s new global digital currency is poised to revolutionize the global payment system. As such, the Facebook Dime project comes with three unique components that work in sync to create an integrated and secure financial system. They are connected:
1. A reliable blockchain technical foundation
A component of the new Facebook Dime cryptocurrency is a blockchain infrastructure with scalability and reliable security that serves as the technical foundation of the payment system.
Dime’s source code is Github’s open source. Source code, written in Rust, can be accessed by everyone and different.
It provides scalability and will help the infrastructure in organizing various projects. Dime is also developing a new programming language called Move to build smart contracts and perform custom transactions.
2. New digital wallet
While it’s quite easy to create a digital wallet after a famous practical class, the Novi is a sophisticated wallet that requires all the time and attention you can afford. One of Facebook’s numerous companies, Novi Financial, is creating a digital wallet for the Diem project. The wallet was known as Calibra until the end of 2020.
Novi is a standalone application that we hope will support integration across WhatsApp, Messenger, Instagram and possibly several other platforms. The ease of using it is already mind boggling.
Related: Novi-FT? Facebook’s NFT support may not accept crypto
Diem Coin is an important component of Facebook’s new global digital currency project. It has a strong support of dime reserves, which include cash assets or cash equivalents.
There are also short-term government securities. As such, the egg is a stable coin. According to the development team, the coin will not be small as it is with Bitcoin and many others. In the early stages, only members of the Diem Association can process transactions. However, Dime plans to completely transform it into an unlicensed proof-of-stack system within the first five years of its launch.
The quality of running the design of the Facebook dime
Like other well-known cryptocurrencies, some policies serve as guidelines for the functionality and design of Facebook Dime. So here are some key values that are firing its unique design as it calls for its launch in 2021:
- People should have the right to control their legal labor and its consequences.
- More people should have access to financial services.
- Global payment networks should be open, inexpensive to use and in good speed. All of this translates into improved economic opportunities and more efficient global trade.
- Gradually but eventually, people will build their faith in different distribution methods of governance.
- In addition to supporting ethical agents and consistently maintaining the integrity of payments, individuals and organizations are responsible for driving the growth of financial inclusion.
- An open and very wide payment network, with unparalleled levels of inter-operability with higher compliance standards, should follow the rules and design procedures.
How does Facebook plan to use it?
There are many opportunities that a cryptocurrency supported by a company can offer to users around the world through the power and reach of Facebook. In addition, the unique opportunities it offers make Facebook Dime a great creation in this crypto era. Here are some ways in which Facebook will soon use Dime:
Users should expect easy and stress-free remittances and money transfers. In addition to comfort, the project assures faster transaction speeds and less expensive charges than financial intermediaries.
The lengthy processes involved in sending money through traditional financial intermediaries, especially across borders, may be a thing of the past.
One of the focus of Facebook is to create better economic opportunities and effective global e-commerce. This becomes even easier to achieve when you consider that the Diem Association has billions of users and Facebook has at least three billion users worldwide.
Being a member of the Dime Association, Shopify will ensure that e-commerce site owners can easily consolidate the currency. Each member company running the B2C service will implement the Diem system on their platform – which is incomparably simple in every sense of the word.
3. Border payment
Eggs can help reduce the cost of sending funds across the border, which is already a substantial 6.5%. Having a cryptocurrency with an adequate payment system means that Facebook Dime is almost completely digital.
The transaction will be pre-programmed in its database. Expect costs to be significantly lower through operating remittance channels. This will reduce the cost of use and increase market share for cryptocurrency users.
Government Dime is one of the most important uses of cryptocurrency and it stems from Dime’s governance structure. It is impossible to compromise with the functionality and features of the dime. Instead, it ensures that the project can help serve as a model financial alternative to transitioning financial flows into governance.
Anything else? In addition to a detailed overview of transactions, grants and expenditures in the public domain for various public welfare works of government agencies, it will guarantee benefits to the public.
Also, since Facebook does not have a single control over Dime, it is not possible to misinterpret the use of Dime against the public interest.
How Facebook Dime is different from Facebook Connect. Facebook launched Facebook Connection in May 2008 as the next iteration of the Facebook platform. It allows users to connect their Facebook friends, identity and privacy to Internet sites. Facebook Dime, on the other hand, is an approved and blockchain-based payment system that includes a private cryptocurrency.
Facebook’s cotton is coming with risk
The announcement of the launch of Libra on Facebook has caused various controversies. Some believed it would rival the sovereign currency, others saw technical and data privacy issues. To be more precise, those who believed that it would replace the sovereign currency may be wrong for a variety of obvious reasons while those who considered the project in light of Facebook’s history of data breaches and its exclusive nature may be right.
First, the cotton coin will be supported 1: 1 with the enduring currencies such as the US dollar, euro, yen, etc. It is said that cotton, the supposed secondary currency, will be an alternative to its main currency. This raises the question of how a secondary currency will replace it depending on the primary currency for the price. That being said, the potential threat is that it could manipulate users’ data.
For example, Hyun Song Shin, economic adviser and head of research at BIS, acknowledges that the participation of large technologies in digital currency brings some potential benefits although it can reduce competition and create data privacy issues. Shin reiterated: “The goal of big technicians in financial services should be to benefit from the benefits while minimizing risk.” He added:
“Public policy needs to be built on a broader approach based on financial control, competition policy and data privacy control.”
Today, anyone can create a cryptocurrency payment system at home. However, the defining factor is that reputable companies with verifiable track records back up Facebook’s dime.
The opinions, thoughts and opinions expressed herein are the sole property of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Michael J. Garbade Co-founder and CEO of the Education Ecosystem. He is a serial tech entrepreneur who previously worked for Amazon, General Electric, Rebate Network, Photobucket and Unicred Group. Garbade has experience working in the United States, Europe, Asia and South America.