The Crypto market is crashing hard and this is not the first time. Few unfortunate events such as Covid19, the Russian war, and inflation have made it much harder for the digital dollar dream to sustain itself right now.
Similarly, one of the biggest tech companies has also been hit by the crypto crash. Meta Platforms Inc.’s well-established and highly controversial cryptocurrency project is ending with the announcement that the Novi digital wallet will close on 1st September of this year.
The Novi digital wallet was launched in November as a beta version with Coinbase Inc as its custodian. Well, Novi did not support Meta’s proposal of Diem currency and instead was launched with the support of USDP which is a stablecoin offered by the Paxos Trust Co.
Later, Diem was expanded with a pilot program with WhatsApp. This allowed users to send and receive cryptocurrency using Novi within a WhatsApp chat. This was as easy as sending and receiving a normal text. This launch with the support of WhatsApp was quite an achievement for Meta and was considered Meta’s step forward in the world of crypto. But just over six months, all the efforts appear in vain.
However, in an official statement, Novi stated that the ability to add money to an account would end starting on 21st July 2022. Also, Novi wallet users are requested to withdraw their balance as soon as possible before access is terminated on 1st September. Moreover, if the funds are left in accounts after 1st September, Meta will attempt to transfer the outstanding balances to a bank account or debit card if they were added to Novi.
To have a better understanding of what let Meta take this step let’s dive into the history of Novi.
What is Novi?
Novi was initially known as Calibra, Facebook’s CEO, Mark Zuckerberg wanted to enable transferring money as easily as possible for its users. However, Facebook’s reputation for its user protection and data privacy raised red flags.
Interestingly, Meta was one of the members of the Diem Association, a group of companies that would ultimately control the digital currency. However, several of them, including MasterCard, Visa, PayPal, eBay, and Stripe, pulled out before it even got off the ground.
Moreover, there were criticisms that Diem and Novi were just tools to enable Meta to harvest financial data to distribute the targeted ads. But eventually, the entire firm was under global scrutiny.
In other words, Novi was supposed to help users send and receive crypto with Diem, the Facebook-backed cryptocurrency which was launched as Libra in 2019 but later was rebranded. Later in February this year, Diem collapsed.
But this is not it!
Meta hops from Novi to Instagram NFTs
Meta might be calling quits on its crypto payment system, it is not out of the crypto industry as yet. Last month the company announced that it would begin testing NFTs on Instagram stories.
NFTs on Instagram 💫— Instagram (@instagram) May 10, 2022
We’re testing ways for creators and collectors to share NFTs they’ve created or own on Instagram with a shimmer effect. pic.twitter.com/tXGoH1Z6Gf
In an official statement, the company plans to use Novi’s technology in future products such as metaverse. “We are already leveraging the years spent on building capabilities for Meta overall on blockchain and introducing new products, such as digital collectibles,” a spokesperson for Meta said. “You can expect to see more from us in the Web3 space because we are very optimistic about the value these technologies can bring to people and businesses in the metaverse.” – stated a company’s spokesperson.