Facebook digital wallet Novi ready to launch but will it have crypto?

Karthik Subramanian

David Marcus, the head of F2 which is short for Facebook Financial, has announced that its digital wallet Novi is ready to launch though he has not given a specific date for the launch as yet.

Facebook

He made a strong pitch for digital payments as a way for making the financial system truly global, open, and real-time in a regulated manner and in a way that can bring any number of people onto the digital financial system without any trouble. He said that the system would help users, merchants, and businesses to move funds around and across borders pretty easily and quickly.

“We feel that it’s unreasonable to delay delivering the benefits of cheaper, interoperable, more accessible digital payments,” Marcus said. “We will continue to persevere and demonstrate we can be a trusted player in this industry — and one that’s bringing positive change by being in it.”

The Novi wallet is much different from the much publicized Libra project that Facebook had tried to launch a couple of years back. It had come under great scrutiny from the regulators which forced Facebook to seek not only a name change but a directional change for the wallet which led to Novi. Now Novi is a project that is based on a stablecoin that is pegged to the US dollar, unlike the previous version which proposed to create a stablecoin pegged to every fiat currency which would have faced a lot of scrutiny from regulators all around the world.

Marcus also suggested that Facebook might be willing to drop off their crypto plans and may choose to go with just fiat currency if that will improve the usage of the wallet, provide more value, and also be viewed favorably by the regulators.

“Let me be clear, if we only offered fiat money in Novi, it would bring people a lot of value,” said Marcus, adding: “So why not just do that and call it a day? Well, we might.”

But he also countered the thought by saying that they still believe that Diem would be the better solution to bring the unbanked into the financial system and improve the payments infrastructure but the going has been tough with the regulators in every state of the US that they have been trying to get licensed in. If this is the challenge within the US, then the challenge across the world would likely be much bigger.

Marcus said that the service would start as free for the users with revenue coming in from the merchants but how this is going to work across the globe especially with Facebook coming under extra scrutiny from everyone mainly due to its size and reach, remains to be seen. Facebook also plans to enter into other financial services as well.

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