WhatsApp is testing a feature that allows a “limited number” of people in the US to send and receive money from a conversation using cryptocurrencies. The feature is powered by Novi, Meta’s digital wallet that was piloted six weeks ago, with payments made using Pax Dollars (USDP), a stablecoin tied to the US dollar issued by Paxos.
The news was announced by Novi’s chief, Stephane Kasriel, and Will Cathcart of WhatsApp.
According to Novi’s website, sending a payment works like sending any other attachment to WhatsApp. You can access the feature via the clip icon on Android or icon + on iOS, and then choose “Pay” from the menu that appears.
Novi’s website notes that there are no fees for sending or receiving money, there are no limits to the frequency of sending payments, and no fees for keeping a balance on your Novi account or withdrawing it to your bank account. Plus, payments are carried forward instantly.
Novi’s pilot feature was originally available in the U.S. and Guatemala, but users in Guatemala won’t be able to access the new WhatsApp payment feature.
Instead, they should continue to use the standalone Novi app. Payments do not affect WhatsApp end-to-end encryption, which applies by default to all personal conversations. The WhatsApp Novi pilot is available in both English and Spanish.
The new pilot feature has its roots in Facebook’s much-publicized cryptocurrency plans (now Meta), which were officially announced in 2019. At the time, Facebook (as part of the Libra Association) was planning to develop and release a cryptocurrency called Libra, which would be linked to a basket of low volatility assets relative to any particular currency.
This will be integrated with a digital wallet developed by Facebook called Calibra. The whole system was designed to offer a way to send money around the world with lower fees than traditional methods.
These plans have changed significantly since then. Libra became Diem, the Libra Association lost several of its most high-profile members and became the Diem Association and Calibra became Novi.
Perhaps most telling is that Novi ended up circulating without the Diem cryptocurrency. In contrast, Pax Dollars is the work of a separate company called Paxos, and Meta relies on coinbase cryptocurrency exchange as a security partner.
The then head of Meta’s Novi, David Marcus, said the company is still committed to Diem when it announced the release of the Novi pilot in October.
“We intend to launch Novi with Diem once it receives regulatory approval,” Marcus wrote on Twitter. David Marcus then said he was leaving the company at the end of the year. He has called the Novi pilot on WhatsApp “the best farewell gift from the best team of all time!”.
While WhatsApp’s U.S. payment plans revolve around Novi and cryptocurrencies, elsewhere in the world it already offers payments using traditional fiat currencies. The operation was widely released in India last year and in Brazil.
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