Facebook asks Coinbase to store Novi digital wallet crypto currencies, Coinbase stock rises

 

On Tuesday, Facebook launched its new digital wallet called Novi. The social media giant had been developing the wallet for crypto currencies from a couple of years. It also said that it would use Coinbase for its pilot. Coinbase stock rose by two percent on Tuesday morning.

Novi is a new digital wallet by Facebook. It lets people send and receive money. It is reported to be instant, secure and free, as there is no fees as of now. Novi posted on Twitter that it has been rolled out in many states in the U.S. and Guatemala. It is available on both the Apple Store as well as the Google Play Store.

The digital wallet will be supported by Coinbase Custody. It keeps users funds secure. It uses “proprietary, fully segregated cold storage capability for managing private keys,” according to the Coinbase blog.

Users of Facebook’s Novi digital wallet will use the Paxos Dollar or the USPD. The stablecoin’s current market rating is at #100. It is linked to the U.S. dollar.

Facebook stated that it chose USDP as it had successfully been in operation for more than three years. It also said that its “important regulatory and consumer protection attributes” made it the choice of the social media company. It also mentioned the fact that the stablecoin is backed by the U.S., in cash or cash equivalents.

Although the partnership has been called a victory for Coinbase, Facebook doesn’t have many options to choose from. Coinbase is a pioneer crypto exchange. It is also the largest exchange in the nation. The partnership might not be a long term one as Facebook is also hoping to migrate Novi to its own coin in future.

Facebook is backing a digital coin called Diem. The coin has not as yet received regulatory approval. Once it does, the Novi digital wallet will move to the digital coin—Diem.

 


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