Whatsapp has followed the path of Twitter by adding a payment option to its messaging platform. However, unlike the micro-blogging site, Whatsapp is basing its payment feature on cryptocurrency.
The payment feature is powered by Novi and started a pilot with limited users in the US. Users can receive or make payments through Pax Dollars, a stablecoin that is tied to the American dollar. The crypto is backed by Paxos.
The payment feature is easy to use as it works just as if a user wants to send an attachment on Whatsapp. To get to the feature, tap on the paper clip icon if you are on Android or the + icon on iOS and select Payment.
Sending or receiving payments attracts no charges, and there is no limit to how many transactions you can do. It is also free to maintain your balance in your Novi account and send your funds to your bank account.
Novi payments are instant.
Stephane Kasriel, the incoming head of Novi, shared the news of the payment feature on his Twitter account.
“There’s a new way to try the @Novi digital wallet. Starting today, a limited number of people in the US will be able to send and receive money using Novi on @WhatsApp, making sending money to family and friends as easy as sending a message.”
The Novi public beta has been available in the US and Guatemala through the standalone app. However, only American testers can use the feature within Whatsapp for now. The pilot test is available in English and Spanish.
The new payment feature does not affect the end-to-end encryption of Whatsapp chats.
Meta (previously known as Facebook) began laying out the plans for the payment feature when it announced it would dabble in crypto in 2019. Meta was going to join in developing a cryptocurrency named Libra, which would be pegged to stable assets instead of a currency. Meta was developing Calibra, a digital wallet, and wanted to integrate it with Libra.
Libra-Calibra was meant to facilitate sending funds globally at lower costs compared to other traditional methods.
However, the whole has changed, with some of the players assuming new identities. Libra became Diem, and the coalition behind Libra had shed some members and became the Diem Association. The consortium also faced opposition from US lawmakers. Facebook itself became Meta and Calibra turned into Novi.
Novi has changed course, now launching with Pax Dollars instead of Diem crypto. The then head of Novi, David Marcus, however, said they would still incorporate Diem when it gets regulatory approval. Marcus is leaving Novi at the end of the year.
In a message on Twitter, Marcus called the payment pilot the best farewell gift:
Marcus worked at PayPal before joining Facebook where he was appointed to run Novi. Announcing his departure from Meta, Marcus tweeted:
“While there’s still so much to do right on the heels of launching Novi — and I remain as passionate as ever about the need for change in our payments and financial systems — my entrepreneurial DNA has been nudging me for too many mornings in a row to continue ignoring it.”
According to Kasriel, the payment pilot will be expanded after the company gets feedback.
Whatsapp is already offering payment services with traditional currencies. The service has been available in India and Brazil since last year.