Updated: Nov 15
Nearly two years in the making, and with a very rocky beginning, the Novi crypto wallet from Facebook is finally being launched in Guatemala (as a pilot initiative for now).
Conceived as part of Facebook’s grand plans to create a new blockchain, programming language, and global currency, the initial version of the wallet was called Calibra, in reference to the Libra cryptocurrency that was then under development.
Numerous objections were raised following the announcement, not least from central bankers and governments nervous about one of the world’s biggest international companies making a move to creating a privatized, borderless currency of its own.
Facebook scaled back its ambitions (probably wise - given the technical difficulties involved in achieving them) and pivoted from creating a global currency to becoming a global bank. As it no longer poses a threat to the US dollar, government opposition, stateside at least, has subsided.
The revamped Novi program was scheduled to launch in early 2021, and as of the time of writing (September 2021) it appears that the app is finally nearing completion.
The head of Facebook’s financial services division David Marcus wrote a blog post in August 2021 outlining the aims of the initiative. Licenses have apparently been secured or approved in every US state, and the company hopes to expand into as many countries as possible.
Let’s take a closer look at it.
Overview of Novi - what sets it apart
Viewed just as wallet, Novi looks to be a solid addition to the range of options currently available for cryptocurrency users.
Think of it as ‘My First Crypto Wallet’. Currently limited to carrying the Diem group of currencies, Novi’s easy-to-use interface and large captive user base (anyone who uses a Facebook product such as WhatsApp or Instagram) could be a game-changer for crypto’s acceptance.
A large portion of the world’s population is unbanked (including 62 million Americans), and cross-border payments using traditional cash-to-cash methods face fees of up to 6.5% and settlement periods of up to 3 days. Facebook already processes $100bn in payments per year, and believes that it could become the global bank for those left behind by the current system.