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“Novi is ready to come to market,” wrote social media giant Facebook’s David Marcus in a blog post. Novi is a digital wallet that is tied to the Diem blockchain-based payment system. Facebook’s stablecoin project Diem, previously named Libra, was first introduced in June 2019 with the original plan to be backed by a wide mix of fiat currencies and government debt. Now, it’s meant to launch as a stablecoin backed by only the US dollar. But it ran into resistance from global regulators leading to its rebranding as Diem. In his blog post, Marcus reported the increased obstacles the project has been facing, which is yet to be launched. Marcus, the former PayPal chief hired by Facebook in 2018 to lead its blockchain efforts, said on Wednesday that the global payments system is flawed, being too slow and too costly, among other things, and they can fix it. And Novi can play an instrumental part in that, he said. “Change is long overdue. It'll happen one way or another,” said Marcus, the co-founder of Diem Association, a non-profit consortium overseeing the development of Diem stablecoin.
“We feel that it's unreasonable to delay delivering the benefits of cheaper, interoperable, more accessible digital payments.”
Marcus noted that they are seeking necessary regulatory clearances and have already secured licenses and approvals for Novi in nearly every state in the US. “We will not launch anywhere we have not yet received such clearances,” he added. He further said the Diem Association is currently engaged in dialogue with US and global regulators and has addressed every legitimate concern raised so that it can build high-quality and compliant stablecoin with extensive consumer protections.
The Time is Now
Novi, previously called Calibra, is designed to allow users to add money to their wallets that would be converted to a Diem digital currency which then could be sent to others worldwide. But for now, Novi would only start with offering fiat currency within the digital wallet but still, “it would bring people a lot of value,” Marcus said. Marcus further noted that Facebook is already 'an actor’ in the payments industry. It has enabled over $100 billion in payments volume in the last four quarters while being used in more than 160 countries for payments in 55 currencies.
“I strongly believe if there was ever a chance to create an open, interoperable protocol for money on the internet and truly change the game for people and businesses around the world, it is now.”
Much like Facebook, Twitter co-founder and CEO Jack Dorsey is working on bringing payments to his social media platform. Last week, Dorsey said he is using “Lightning to enable a currency for the internet” by allowing every account on Twitter to link to a Bitcoin Lightning Wallet. “FB beat twitter to the punch again. And jack owns a crypto currency focused payments company,” tweeted @IamNomad, a cryptocurrency market maker. However, Ethereum co-founder Vitalik Buterin is skeptical of both Dorsey and Facebook CEO Mark Zuckerburg’s big plans in the cryptocurrency space. Commenting on Dorsey’s plans to create a new business focused on decentralized financial services using Bitcoin (BTC), Buterin said in an interview with Bloomberg; it doesn't really have the functionality to do that as it was designed largely to be a “currency of the house.” This is unlike Ethereum, which allows one to directly put ETH or Ethereum-backed assets into these smart contracts where arbitrary conditions govern how those assets get released, “Jack is basically going to have to create his own system that enforces those rules,” he said. As for Zuckerberg’s plan to turn Facebook into a “metaverse company,” Buterin pointed to a “huge amount of mistrust” about the social media platform; as such, he recommended Zuckerberg to build on the existing blockchain instead.