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Coinbase Chosen as Facebook’s Custody Partner for Novi Pilot By


© Reuters

By Sam Boughedda — Coinbase (NASDAQ:) shares have seen a sharp rise Tuesday following a positive crypto market and news that it has been chosen as the custody partner for Facebook (NASDAQ:)’s pilot of Novi, a new digital wallet.

Coinbase shares rose 2% on Tuesday and hit a high of $307.83 after the opening bell. Facebook shares are up nearly 1%.

Facebook’s wallet will enable people to send and receive money abroad instantly without fees. Coinbase Custody uses a fully segregated cold storage capability for managing private keys.

Coinbase said users involved in the pilot can acquire Pax Dollars through their Novi account. A Pax Dollar is a stablecoin backed one-to-one by the U.S. dollar and issued on the blockchain.

“Novi users who can participate in the pilot can acquire Pax Dollar (USDP) through their Novi account, which Novi will hold on deposit with Coinbase Custody. Novi users will then be able to transfer USDP between each other instantaneously,” stated Coinbase.

Facebook’s David Marcus said via Twitter that the pilot will be held in Guatemala and the U.S. to test core feature functions.

“Remittances are a critical way to achieve financial inclusion. Today, we’re rolling out a small pilot of the @Novi digital wallet app in two countries — the US and Guatemala. People can send and receive money instantly, securely, and with no fees,” said Marcus.

Users of Novi will also benefit from Coinbase Custody’s insurance program, which includes a $320 million commercial crime policy.

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