Senators asks Facebook to immediately shut Novi wallet pilot

Five senators have called for the immediate closure of Facebook’s new crypto wallet just hours after it was launched in a partnership with Coinbase, many crypto media reported.

What can be seen as a new faceoff between the US senators and world’s biggest social media platform, Facebook has been asked by banking committee senators to shut its crypto wallet project Novi soon after it was launched.

Five senators have called for the immediate closure of Facebook’s new crypto wallet just hours after it was launched in a partnership with Coinbase, many crypto media reported.

The senators in a letter asked Facebook CEO Mark Zuckerberg to immediately discontinue the project and wrote, “Given the scope of the scandals surrounding your company, we write to voice our strongest opposition to Facebook’s revived effort to launch a cryptocurrency and digital wallet, now branded Diem and Novi, respectively.”

The letter comes hours after Facebook launched Novi, a new digital wallet, as part of a pilot program in the US and Guatemala. 

“Facebook is once again pursuing digital currency plans on an aggressive timeline and has already launched a pilot for a payments infrastructure network, even though these plans are incompatible with the actual financial regulatory landscape, not only for Diem specifically, but also for stablecoins in general,” the letter added.


Facebook first announced its plans to enter the cryptocurrency industry over two years ago, but the digital currency project, called Libra, was halted after heavy criticism from lawmakers and regulators. The Libra currency was later rebranded as Diem, which has yet to be released alongside the new wallet product.

Novi is the firm’s crypto wallet, designed to hold the Diem token and other stablecoins. The pilot will enable users to acquire, send and receive Pax Dollars (USDP) through their Novi account.

The letter was signed by the office of Senator Brian Schatz and was co-signed by Tina Smith, Richard Blumenthal, Banking Committee Chairperson Sherrod Brown and Senator Warren.

They stated that, “Facebook cannot be trusted to manage a payment system or digital currency when its existing ability to manage risks and keep consumers safe has proven wholly insufficient.”


In his twitter post on 19 October 2021, David Marcus, co-creator and a board member of Diem wrote, “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.”

The Novi pilot uses USDP (Pax Dollar) through partnerships with Paxos and Coinbase. USDP is a well-designed stablecoin that’s been operating successfully for over three years and has important regulatory and consumer protection attributes. 

Scaling Novi will take time and this pilot is a great chance for us to learn from our early customers. We want to make sure that our wallet has been fully tested before we open Novi up to more people, Marcus tweet explained.

“I do want to be clear that our support for Diem hasn’t changed and we intend to launch Novi with Diem once it receives regulatory approval and goes live. We care about interoperability and we want to do it right,” Marcus tweet adds.

Facebook has recently revealed its plan to create 10,000 high-skilled jobs in the European Union over the next five years to build its own metaverse.

Jagdish Kumar
Klever Writer
You can follow me on Twitter.com/TokenBharat

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