Facebook is in the process of launching an online wallet that will be able to keep cryptocurrencies. An official at the top of Facebook has confirmed that. David Marcus, head of Facebook’s crypto department, stated that the company could create a wallet dubbed “Novi” later in the coming year.
Facebook has launched its highly-anticipated test program Novi to test its wallet’s digital capabilities in the US in addition to Guatemala. This launch is to test the capabilities of the wallet.
Novi is an online wallet service offered by Facebook that allows users to transfer and receive funds internationally, without incurring additional fees. Wallet utilizes Stablecoin Pax Dollar (USDP) to accomplish this.
How Novi Wallet Works
Novi allows users to make instant transactions with no fees. USDP is the currency used in this. USDP can also be a type of cryptocurrency token, similar to other cryptocurrencies on the market.
It is issued by a New York-based financial services company and is regulated by the New York State Department of Financial. As per the firm, they will be using Coinbase as the custodian of funds from users who use the platform.
What are the benefits to users?
Crypto Wallet Novi allows the users to exchange US dollars swiftly and, in return, receive the equivalent amount of USD PAX, kept securely by Coinbase. Users can immediately transfer cryptocurrency to the recipient at no extra cost.
The receiver can convert their PAX Dollars to dollars or local currency with no value differences. The entire process is rapid, secure, and without cost. These are the most crucial features specifically created to protect remittance routes in nations like Guatemala where there is no adequate financial infrastructure in many areas.
US senators have pushed Facebook to immediately end the service. They are due to the recent privacy breach. Facebook, however, on the contrary, on the other hand, stated in response to senators’ criticism the following “Security is the most important thing for Novi users, so protecting privacy will always be first for us. We are keeping users’ Novi and Facebook accounts separate to ensure both financial and privacy security.”
The 26 businesses have all been selected to create a blockchain-based platform for Novi. The companies are referred to by the name of the dim association. The company will manage the digital wallet as a third party. The cryptocurrency that it will run is named Diem.
Facebook and coinbase’s collaboration
Facebook recently announced a partnership in a recent partnership with Coinbase as its custodial partner in the pilot program of Novi. Novi is a brand new digital wallet that allows users to send and receive money without any fees. As per the Coinbase official Coinbase blog the company is a partner with Novi by allowing Coinbase Custody which secures user funds.
They will be put on the deposit of Novi using Coinbase Custody. After that, Novi users will be in a position to transfer USDP to one another instantly.
The funds from Novi customers will be held by Coinbase Custody Trust Company. Coinbase Custody Trust Company. It is a custodian that is a New York-certified Company. The company adheres to the guidelines established by the New York Department of Financial Services.
Coinbase Custody is a leading crypto-native custodian and platform that safely manages over $180 billion in crypto assets on its platform. In the last nearly nine years Coinbase has developed extensive experience in the safe and reliable cryptocurrency infrastructure we originally developed to power our first-party app, Coinbase said.
David Marcus, head of Facebook’s Novi project, has chosen USDP which is also known by the Paxos Standard stablecoin, because it is completely supported through US dollars and completely stored in cash and cash equivalents, as per an announcement. This means that users can withdraw their funds in the local currency, he explained.
According to Coinbase, it is believed that shortly “every company will be a cryptocurrency company.” He said that this would include banks, fintech-related platforms as well as gaming companies, social media as well as consumer-oriented brands.
