Facebook's Libra (B): The Privatization of Money?

By: George Serafeim and Ethan Rouen and Marco Di Maggio and Amy Klopfenstein

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Synopsis: This case addresses the events that took place following the conclusion of the case "Facebook's Libra (A): The Privatization of Money?" In October 2019, several months after the conclusion of the A case, multiple members of the Libra Association announced that they were leaving the project. Observers speculated that the departures were due to Libra's inability to meet regulatory scrutiny. Nevertheless, the Libra Association formed a board and formalized its governance structure with 21 founding members. Through the remainder of 2019 and 2020, Libra made significant changes to its product in an attempt to win regulatory approval. It also changed its name to Diem to distance itself from the controversies surrounding the original Libra product. By December 2020, the proposed cryptocurrency was a stablecoin pegged to the U.S. dollar. The Diem Association planned to launch the new currency in early 2021; however, it had yet to secure regulatory approval, even as political skepticism toward the product endured.