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Whatsapp Is Developing A New Cryptocurrency Tool For Money Transfers

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WhatsApp announced this week that it is testing a new function that will allow US users to transmit money without paying fees using cryptocurrency. The new payment service is yet another illustration of how digital currencies are gaining acceptance in the mainstream financial sector in the United States.

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The cryptocurrency service will be powered by Novi, a recently established digital wallet owned by Whatsapp parent firm Meta (previously Facebook) that allows users to transmit money worldwide. Six weeks ago, the business began testing Novi with a small number of users in Guatemala and the United States. In a joint post on Wednesday, WhatsApp CEO Will Cathcart and Novi CEO Stephane Kasriel announced that Novi would be offered on a trial basis to some WhatsApp users in the United States.

“People use WhatsApp to coordinate sending money to loved ones and now Novi will help them do that securely, instantly and with no fees,” Cathcart tweeted.

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During the trial period, anyone using Novi will be able to send money using the U.S. Pax Dollar (USDP), a regulated cryptocurrency produced by the New York-based blockchain business Paxos Trust. According to the Novi website, USDP is intended to be connected to the value of the dollar in order to prevent the price volatility associated with Bitcoin and other cryptocurrencies. One Pax Dollar is the same as one US dollar. Users deposit funds into their Novi accounts via the free app, which instantly translates US dollars to Pax.