Meta, the technology powerhouse known for Facebook, is making bold moves to re-enter the cryptocurrency sector, particularly focusing on stablecoins, three years after shelving its controversial Libra/Diem project.
Despite the regulatory uncertainty surrounding stablecoins in the US, what opportunities and challenges will Meta encounter with its new strategy?
Meta's Resurgence in Stablecoin Sector
As per Fortune, Meta is currently in early talks with various cryptocurrency firms to explore the potential of stablecoin applications, with an emphasis on facilitating cost-effective cross-border payments for content creators.
Initially drawing attention in 2019 with the Libra project, later renamed Diem, Meta aimed to create a stablecoin for global payments. However, regulatory pressures and opposition led to the suspension of the project in 2022. After a period of inactivity, Meta is reemerging with a fresh plan, highlighting the use of stablecoins for cross-border payments to its content creators.
Fortune notes that Meta's objective is to reduce transaction expenses, which are typically high with traditional payment methods like SWIFT. The company's collaboration with cryptocurrency companies indicates a possible shift towards integrating existing stablecoins rather than developing a new one, as previously attempted.
The naming of Ginger Baker, a former Plaid executive, as Vice President of Product in January 2025, reinforces Meta's commitment to reestablishing its presence in the cryptocurrency market.
The Success of Meta's New Strategy
While Meta's new direction could allow it to swiftly enter the expanding stablecoin market, uncertainties persist due to the unstable regulatory environment surrounding stablecoins in the US.
Although the OCC confirmed that US banks can offer crypto custody services to customers, challenges persist within the stablecoin sector. The GENIUS Act stablecoin bill in the US is also undergoing scrutiny for certain restrictions, including the prohibition on yield, deemed unreasonable by Coinbase CEO Brian Armstrong.
Despite facing challenges, Meta's potential success may lie in partnering with established stablecoin providers to navigate regulatory obstacles encountered in the past with the Diem project. Integrating stablecoins into platforms like Instagram and WhatsApp could significantly reduce transaction fees, attracting more creators and fostering reliance on Meta's ecosystem.
Meta's reentry into the stablecoin domain underscores its commitment to incorporating cryptocurrency within its operations. However, its triumph will hinge significantly on navigating the uncertain regulatory landscape in the US and globally.