By targeting approximately 1.7 billion people around the world who do not have access to a traditional bank account, the American firm Facebook aspires to rely on its 2.4 billion users to reach the forgotten and the destitute people of the conventional banking system.


The name Diem comes from Latin and means “day.” It was formerly known as Libra but was rebranded in December of 2020. The new global virtual currency will be based on blockchain technology. Although the initiative of the new virtual asset is the result of the American company Facebook, Diem is also supported by a consortium the Diem Association.


The blockchain technology and the bitcoin

A blockchain is a technology of storage and transmission of information. It is truly innovative and revolutionary because it allows securing the information transparently and in a totally decentralized way. Thus, everything on the blockchain remains on the blockchain, it cannot be altered or modified by anyone and is visible to all.
The bitcoin is the first application of the blockchain. Following the 2008 financial crisis, the creator of Bitcoin wanted to propose an alternative to the banking system: a system without an institution and a central control.



Despite the fact that they are based on the same blockchain technology, Diem and Bitcoin do not share a lot of connections.

For instance, the Bitcoin network is composed of anonymous nodes (servers), requiring expensive and long-term computational power (the mining of data).

Diem is based on a private blockchain where each member of the Diem Association is in charge of a node (a server) forming the skeleton of the chain and allowing to record the transactions. This is a major difference. The identity of the nodes is known, ensuring secure and faster financial transactions.

The second huge difference is the stability of Diem. The virtual currency will be backed one-for-one by the US dollar to ensure a certain stability of its price and easy convertibility to fiat currencies. It will also be backed by a reserve of assets made up of cash or cash equivalents and very short-term government securities.

The price of bitcoin mostly comes from the supply and market demand so depending on the situation., Tthe value can fluctuate a lot and hence is very volatile.


The Diem Association is the organization in charge of the supervision of the currency network. It is an independent, not-for-profit association based in Geneva, Switzerland.

The elected members of the council of the association will ensure the expansion of the network and the good management of foreign exchange reserves for the stability of the virtual currency.

Diem Association virtual money

The consortium behind the project currently includes 25 companies from different fields of activity (tech, payment, telecoms, blockchain, venture capital, and NGOs).

Each member contributed a minimum of 10 million dollars to be accepted as a founding member of the association. Since each member oversees security for a node of the blockchain, they all together maintain the network. They will ensure the expansion of the network and the good management of foreign exchange reserves for the stability of Diem.

The governing body of the Diem Association is the Diem Association Council. It is formed by a representative of each contributing member. They will vote on policy and operational decisions.

Facebook assures that it will retire from the leadership role and all members of the association will have an equal vote in the governance of Diem.


To use Diem, people will be required to use the intermediate Novi "channel" belonging to Facebook. It is an app compatible with IOS and Android that will play the role of virtual wallet and will be directly integrated with Facebook message platforms: WhatsApp and Messenger.
A valid ID will be necessary for the registration.


A small percentage of transactions made through Novi will be levied by the Diem Association. These fees will be lower than those practiced in banks.

But several remarks have already been raised on the Diem by different governments. Governments are worried about the security of this virtual currency. Facebook assured that technologies will be implemented to prevent money laundering and fraud by using the same audit and anti-fraud processes that banks and credit cards use: automated systems that will proactively control activities to protect and prevent risky behaviour.

Live help will be available to users and Facebook will reimburse users who have lost their money via fraud.


Libra was initially slated to be released in 2020 but faced numerous challenges including regulatory roadblocks set by the U.S. Senate, the House Committee on Financial Services, and G8. The Libra Association also suffered a series of important exits such as PayPal, Mastercard, and Visa.

However, Diem is now poised to launch in 2021. Extensive testing is being carried out to ensure that the virtual currency is secure and ready for mass distribution. On the regulatory side, Diem is still awaiting the final approval of the Swiss Financial Market Supervisory Authority (FINMA).

By means of Diem and Novi, Facebook is looking to construct a new non-profit image, one close to the people who have been abandoned by banking systems. It wants to construct a brand that desires to be independent of the traditional financial systems while being safe and secure.
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