Image Source: Newsbreak
On Tuesday 19th October 2021, Facebook unveiled Novi, a new digital wallet for cryptocurrency, with Coinbase assisting with the logistics. Coinbase announced early Tuesday that it will be keeping the cryptocurrency that Facebook would give to users who sign up for the Novi wallet’s early beta version. Following the announcement, Coinbase shares were up 2% on Tuesday morning. According to the announcement, Novi will allow individuals to transfer and receive money internationally rapidly, securely, and without fees, starting with a limited trial operation in the United States and Guatemala.
Coinbase is supporting Novi through Coinbase Custody, which uses software to handle crypto transactions to keep assets safe. The collaboration is a success for the country’s largest cryptocurrency exchange, but it’s not surprising considering the lack of crypto custody choices currently available. The Paxos Dollar, or USDP, will be used by Novi users. The stablecoin, which is now ranked #100 on CoinMarketCap, is linked to the price of the US dollar. In terms of market capitalization, USDC (United States Dollar Coin), another stablecoin tied to the dollar, is ranked in the top 10.
Image Source: Blockchain news
Facebook claims it picked USDP to test its systems using a stablecoin that has been in operation for more than three years. USDP (Union Solidarity and Development Party) has significant regulatory and consumer protection features, according to the business, and its reserves are completely guaranteed by the U.S. dollar and kept 100 percent in cash and currency equivalents. Once governmental clearance is received, Facebook plans to move Novi to Diem, a cryptocurrency it backs. Novi’s objective has always been interoperability with other digital wallets, according to Facebook. Novi has been under development since 2019, however it was previously known by a different name. The digital wallet program was first launched in conjunction with Facebook’s libra stablecoin, a project that has been stymied by authorities seeking to limit the scope of Facebook’s original crypto vision.