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| Facebook is confidently struggling as it launches Novi prepared |
Facebook says it's ready to launch its most ambitious new product in years, a digital wallet called Novi. But officials say Washington could stand in his way.
The company needs to convince regulators who question its strength that this is a good idea. "When we need one thing, it's the benefit of the doubt," said Facebook's David Marcus. We start with mistrust and we have to catch up.
Many of the company's broader ambitions, such as building the Metaverse and developing its own shopping platform, have been linked to payment innovations.
Marcus traveled to Washington last week to meet with key regulatory stakeholders to discuss the implementation of Novi's blockchain-based wallet.
He said cryptocurrency-based payment systems help reduce access to modern financial systems.
He also spoke about the Deem Association, a group of 26 companies and non-profit organizations that are building the blockchain-based payment system that Novi uses.
The organization’s goal is to act as a neutral third party allowing various digital wallets around the world to use the same type of cryptocurrency called Diem for transactions.
Marcus said Facebook hopes to launch Novi with Diem before the end of the year.
Although novi is now ready to go. But it's not clear if Diem is ready this year, in part because he needs more regulatory support. He said that we are definitely planning to launch Novi in the second half of the year.
The company first announced its digital payments ambitions in 2019. However, when it faced skepticism and regulatory scrutiny, it had to transform and rebrand its products.
"I hope Washington will be more receptive because a lot has changed," Marcus said. I guess one thing I haven't made clear yet is how to make money.
Facebook is confidently struggling as it launches Novi. prepared
The company has been promoting digital payments for many years. But paying is not yet a profitable activity for the company.
In the past 12 months, the company has processed nearly $100 billion in payments, mostly through messaging platforms, shopping experiences and small advertisers. However, he will not receive any hidden commissions on these transactions.
The company hopes to help build a deeper digital payment system. It hopes to make online transactions easier and faster for more people around the world.
It will start rolling out free peer-to-peer payments next year and eventually facilitate paid transactions between individuals and merchants.
Marcus expects payments won't have significant returns as early as 2023, when merchant payments start to grow.
One of the regulators' biggest concerns is Facebook's entry into payments, as it could destabilize the global financial system by replacing its digital currency, Diem, with local global currencies such as the US dollar.
To solve this problem, Diem moved his company from Switzerland to the United States in May. He said he is trading in a digital currency, Diem, whose market value is pegged to the US dollar.
Marcus is the former CEO of PayPal. He has spent most of his career in small business. His goal is to help regulators understand what Facebook does and why it matters.
He said the current system is in trouble because 62 million people in the United States are unbanked. There are 1.7 billion people in the world without a bank account. About 1 billion people lack access to financial services. This is not how it should be.