Facebook’s Libra stablecoin would allow anyone to transact money online. Libra’s stability would be ensured by a basket of fiat currency, and supervised by a group of companies.

In 2019, Facebook revealed that users of the Libra app wouldn’t need a Facebook account in order to send money. It was believed at the time that Libra had the potential to revolutionize cross-border payments and international commerce. It was a concept that combined the power of Facebook’s social network with the promise of cryptocurrency.

This article is part of the “CoinDesk Turns 10”, a series that looks back on seminal crypto stories. Our choice for the most important story of 2019 is Libra.

Mark Zuckerberg, CEO of Facebook, said at a Congressional hearing held in October 2019 that “we do two kinds of work on payments.” “One is to build payment systems which allow people send money over existing financial systems.”

“[Then] There’s another work that we’re doing with Libra. We’re trying help rethink how a modern financial infrastructure would be today, rather than starting it 50 years ago, on outdated systems.”

It would have been great if only a part of the project was ever realized.

Also in this series: How the DAO hack changed Ethereum and Crypto

In the end, lawmakers worldwide caused a backlash, forcing Facebook, its partners, and many of their partners, to abandon plans for a stablecoin and a dividend token.

The remnants were eventually sold to Silvergate Bank, which had closed its doors in the past year. They launched only a single wallet project (that is now defunct), and did not do much else. Facebook, which was the driving force behind Libra , rebranded as Meta, and refocused on the metaverse (which is struggling). Other companies in the payments, telecommunications, and other sectors that were originally part of the coalition have returned to their regular businesses. However, some are still active within the Crypto sector.

The project never really took off but it left behind a few lasting legacies. Legislative initiatives have been launched around the world in response to Libra and crypto has received a huge boost in mainstream acceptance. There’s also the technology that underpins the project. As of the time of publication, several project have been launched by former Meta staff and use Libra’s technology.

What went wrong

The project was doomed by its association with Facebook. At the time, the Cambridge Analytica Scandal had just occurred.

Dante Disparte was the head of policy and communication for the Libra Association in June 2019. He is currently the chief strategy officer of stablecoin issuer Circle Internet Financial.

Dante Disparte, the policy chief at Diem Association, formerly Libra (linked to Facebook), joined Circle in April 2020.

Libra asked for forgiveness rather than permission, said Disparte, echoing the comments made both by Zuckerberg and David Marcus, one of Libra’s original creators, during the project’s early stages.

Zuckerberg, in an October 2019 speech to Congress, said: “We are committed to getting the necessary U.S. approvals for the Libra payment system before we launch it in any country around the world. Even if those approvals may not be required strictly.” We’re working closely with all the regulators who have jurisdiction over part of our work and will seek their approval.

I believe Libra has been met with an overreaction all around the world

Regulators seemed reluctant to grant this permission. The Libra Association’s oversight was not a comfort to policymakers, who saw it as a Trojan Horse that would allow Facebook to control the project.

The Libra Association was founded by a number of major payment technology companies, including Visa and Mastercard.

Crypto members included Anchorage, Andreessen-Horowitz and Coinbase.

Disparte stated that when the Libra project was announced, he had a personal calculation in mind. He thought it would be an important project, one that would “change the world” and, if not, at least change the direction of the conversation.

Read More: David Marcus – Stablecoin Statesman (2019)

Legislators went as far to warn that some payment firms involved in the Libra project could be subjected to increased regulatory scrutiny. Visa, Mastercard, and PayPal all withdrew from the Libra Association before it was formally established.

Disparte was underprepared for this fight. He said that they had little more than white papers with ideas in them.

Three different full Congressional hearings were held within months of Facebook announcing the white paper.

Disparte stated that “in the end, it was a split-screen moment that was repeated all over the globe.”

Libra was officially announced in 2019. However, rumors about its impending launch have been circulating since six months. Facebook’s involvement with blockchain and crypto technologies has been well-known for over a decade.

Facebook remained mum on the details of its project, leaving it to reporters to guess based on the little information available.

Zack Seward was an editor for CoinDesk from 2019 to 2019. He flew out Menlo Park in California, where he received private briefings by Facebook executives and Libra leaders before the big reveal.

It was a super secret. This was a big deal. He told me that there had been a few reports, but now it was official.

Also included in the “CoinDesk Turns 10 series” – 2020: Rise of the Meme Economy

Seward heard directly from CoinDesk’s editors in the heart of Silicon Valley.

He said, “They shared technical documentation and white papers. The grand vision of what this would accomplish.” “At that time, our main interest was in the involvement of these large, giant corporations. They invested money in order to secure the network and would give it legitimacy, right?

CoinDesk published five stories on the project in a short time span. They covered the dividend token, the hint at a project for digital identity, how technical issues were borrowed from Bitcoin and Ethereum and explored the white paper.

Despite this, the project was kept in secret. This reporter traveled to Geneva in Switzerland to cover the official creation of the project’s governing body. However, the governing body didn’t want immediate media coverage.

Libra, despite never having been launched, has left a huge legacy.

Facebook’s involvement in cryptocurrency helped to mainstream the idea, bringing what was at the time a fairly staid bear-market into wider public awareness.

“It was the middle of June 2019. This was the doldrums before the mania in 2021 when crypto became mainstream. Seward explained that this was the first time that crypto had a small amount of mainstream appeal.

Many people asked what Libra was. This led them to ask what crypto was long before the term became commonplace.

CoinDesk turns 10: What we learned from reporting a decade of crypto history

Crypto “popped on the public’s radar like it never had before,” Seward explained. It was the first time I heard that people in Silicon Valley were thinking about Web3. “OK, we should start thinking about it too.”

Legislators began to talk more about crypto. Libra prompted various legislative bodies, including the Senate, to introduce and pass legislation that addressed the crypto ecosystem. It also sparked more action by some central banks and regulators to address the issues Libra sought.

Disparte stated that there is no doubt the concept of central-bank digital currencies (CBDCs), was largely an abstraction before Libera. At that time, no nation had launched a CBDC nor was it seriously considering digitizing its currency using a distributed ledger.

He said that more than 100 banks study CBDCs in some way.

A draft bill was also created that specifically addressed stablecoins, as a subsector within the crypto ecosystem.

Disparte referred to the landmark Markets in Crypto Assets legislation of the European Union, which is close to becoming law after years and years of work.

He said that the regulation was born out of the fear of the big tech companies, in particular, entering the money-movement business. “Libra, in some ways was a project which was also a shield that took the brunt from the world’s regulatory responses, public hearings and policy responses.”

Read more: Meta to Close Novi Crypto Payments wallet in September, Ending Libra saga

Ben Schiller, Nick Baker and Ben Schiller edited the book.