WhatsApp announces launch Novi, a cryptocurrency payment platform
In December 2021, WhatsApp announced the creation of a first pilot programme that will allow cryptocurrency payments to be made through the app.
The pilot programme will be available to a limited number of WhatsApp users (iOS and Android) only in the United States and Guatemala, but not in the European Union for the time being.
Payments will be made on WhatsApp through Meta’s digital wallet (Novi), with a stable coin called Pax Dollars, the value of which is pegged to the US dollar.
As WhatsApp’s head, Will Cathcart, explained, the project was born after detecting a business niche that was getting out of hand: families and groups of friends routinely coordinate money payments through WhatsApp, but make payments through other platforms, also assuming a cost for it.
However, with the implementation of Novi, users can buy and sell the cryptocurrency offered on WhatsApp for the same price, with the assurance that it costs the same as the US dollar, without the fluctuations of other cryptocurrencies. Facebook presented it as a way to facilitate the movement of money, without the need for fiat money transfers.
Security is precisely one of the main novelties of the Novi platform proposed by WhatsApp: in principle, only Pax Dollars issued by Paxos Trust Company, which are held by Meta (a company regulated by the New York Department of Financial Services), can be used, so the associated risk for users is significantly lower than that of other cryptocurrencies such as Ethereum or Bitcoin, for example.
However, it is still essential to remember that cryptocurrencies are digital currencies that still lack legal regulation not only in the United States, but also in the European Union and in Spain.
As regulators have repeatedly warned, investing in cryptocurrencies is a risky activity which, in addition, and as a consequence of the absence of a regulatory framework, means that the user cannot benefit from the guarantees or protections offered in the legislation on banking or investment products.
In this respect and considering the scarce development of the field of cryptocurrencies in the legal sphere, it is very important, when investing in or doing business related to cryptocurrencies, to have experts in the field who can provide legal advice on these issues from the different perspectives that arise in a matter of this nature.
At Lupicinio International Law Firm we have an experienced and expert team in the field of cryptocurrencies and blockchain, specialised in providing legal advice in this area. The team providing legal advice in the field of cryptocurrencies and blockchain have a long-term professional track record and consist of specialists with extensive experience in this field.
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