A digital transaction settlement system being developed by researchers working on Facebook’s Novi cryptocurrency digital wallet app could support up to 160,000 transactions per second, “about 7x the peak transaction rate of the Visa payments network”, according to a paper published by the research team.
The 15-page paper, ‘FastPay: High-performance Byzantine Fault Tolerant Settlement’, describes how the real-time gross settlement system, known as FastPay, “allows a set of distributed authorities, some of which are byzantine, to maintain a high-integrity and availability settlement system for pre-funded payments.
“It can be used to settle payments in a native unit of value (cryptocurrency), or as a financial side infrastructure to support retail payments in fiat currencies.”
The FastPay system, the paper says, “supports extremely low-latency confirmation (subsecond) of eventual transaction finality, appropriate for physical point-of-sale payments.
“It also provides extremely high capacity, comparable with peak retail card network volumes, while ensuring gross settlement in real-time.
“FastPay eliminates counterparty and credit risks of net settlement and removes the need for intermediate banks, and complex financial contracts between them, to absorb these risks.”
The paper’s findings include the results of experiments which, researchers say, achieved transaction rates of “over 80,000 transactions per second with 20 authorities — surpassing the requirements of current retail card payment networks, while significantly increasing their robustness”.
Alberto Sonnino, one of the three authors of the paper, explains the system in more detail in a video:
Facebook’s Novi digital wallet will enable users to “send and receive money as easily as you message friends, family and businesses” and make instant transfers using the social media network’s Libra digital currency.
Facebook revealed its plans to create a blockchain digital wallet, then known as Calibra, in June 2019. It has yet to confirm when the Novi wallet will be rolled out to the public.