Originally ambitious, Facebook’s own cryptocurrency project has waned with pressure from authority and partners’ withdrawal
You may not remember, but a few years ago, Meta — then still called Facebook — revealed their plans to create their own cryptocurrency and integrate it into their networks. It didn’t work out: after small tests in the US and Guatemala, the Novi pilot will end in September.
According to the project’s website, both the Novi and Novi apps on WhatsApp will no longer be available from September 1. Prior to that, on July 21, users will no longer be able to add money to their wallets.
The recommendation is that they withdraw their current balance as soon as possible. Transaction history will also no longer be accessible.
According to Meta, Novi’s blockchain technology will not be lost. The idea is to take advantage of the project’s assets and lessons learned in the construction of the metaverse, the company’s main focus at the moment.
Facebook’s Cryptocurrency Has Declined
Meta ’s plans for cryptocurrencies went public in 2019, when the company was still known as Facebook.
In June 2019, after many rumors, the company revealed details of the project: a cryptocurrency called Libra, backed by traditional currencies . It would be used in a standalone app and in Meta products such as WhatsApp and Messenger.
The idea was to connect users from all over the world in a single currency, making international transfers possible at virtually no cost.
A subsidiary called Calibra would be responsible for creating the digital wallet, which would bear the same name. And the entire project would be in charge of an association called Libra, which had the support of large companies, such as Visa, Mastercard, PayPal, Uber, Spotify and Mercado Pago .
Ambitious, right? Governments did too.
US and European regulatory authorities have expressed their concern about Facebook’s endeavor. Mark Zuckerberg, CEO and founder, had to testify before the US Congress to explain what the story was.
Little by little, the partner companies in the Libra Association were leaving the project .
The way out for Meta was to reduce the project’s ambitions. First, abandon the idea of a world currency and embrace stablecoins , mirroring the dollar or the euro, for example.
To mark the changes, the Libra coin and the Calibri wallet have been given new names: Diem and Novi , respectively.
The Novi pilot was finally released in October 2021. It was quite different from the original: the Diem cryptocurrency was not used, but the USDP-backed stablecoin. Coinbase was responsible for the custody of the money.
Now, the project comes to an end.