Company Name: covers
Founders: Obi Nwosu, Justin Moon and Eric Sirion
Date of foundation: June 2022
Headquarters location: Fully remote
Amount of bitcoin held in treasury: N/A
Number of employees: 27 full-time employees
Website: https://www.fedi.xyz/
Public or private? Private
Just a few years ago, Obi Nwosu was running Coinfloor, a long-established and successful bitcoin exchange in the UK. But something was bothering him. He knew there was so much more he could do with freedom technologies like bitcoin to help people around the world.
So he and two partners founded coversa company that recently launched a “community super app“,” as Nwosu calls it, which provides an easy and private way to not only manage money but also communicate digitally and meet the different needs of communities around the world.
“We created Fedi because it solved a problem we could see,” Nwosu told bitcoin Magazine.
“That problem was how to empower disempowered communities around the world and how to get millions of people who were using (bitcoin) exchanges a path to move from third-party to self-custody,” he added.
“We realized that the middle ground was community. If we could find a way to empower communities, to offer an offering that was as good, or in some ways better, than the centralized offerings that by far are still the custodians that the vast majority of people use,[and replace them with]parties that people trust more than these third parties, that would be the way. That was the initial idea, and the rest is history.”
To modify Nwosu's words slightly, one could say that the rest is history in the making.
After more than two years of developing the Fedi super app, the company launched it on August 6, 2024. And what the app offers, even in its first version, is perhaps more than Nwosu himself imagined when he undertook the project.
What is Fedi?
The Fedi company has two main components, according to Nwosu.
“It has the app, also called Fedi, and it has a network of experts who are local and can support users,” he explained. “We call them the Fedi Order.”
The app leverages what Nwosu calls “freedom technologies,” such as bitcoin, Lightning, and Nostr. It also employs the Fedimint Protocolwhich allows users to share custody of bitcoin; use the Lightning Network; and mint ecash, digital tokens tied to the value of bitcoin, fiat currencies, or other assets that are used to preserve privacy in transactions.
On top of that, it allows users to send messages privately and has other functionalities, features and even other apps within the app, hence the term “super app.”
“You don’t need to install multiple apps to get things done,” Nwosu explained. “(With Fedi), you have one app and you can, in one place, do all the things you need to do.”
Imagine having WhatsApp, twitter and Venmo in a single app. This is what Fedi offers, albeit with different and more technologically free versions of messaging, social media and payment apps.
However, because some of this technology is new and difficult to use (particularly bitcoin, Lightning and e-currencies), Fedi provides community support through the Fedi Order, made up of “Fedi Knights,” which functions as a “decentralized Genius Bar,” according to Nwosu.
“If you have an iPhone and you have a problem with it, you can go to an Apple store and go to the Genius Bar and someone who is knowledgeable can help you solve that problem,” he said.
“We wanted to replicate that feeling. That’s what Fedi Order does. They offer on-the-ground community support, which is needed if you want to take bitcoin beyond expert or enthusiast users,” Nwosu added.
This type of support is especially useful for tutors in Fedi communities.
Guardians and the federated custody model
To carry out Nwosu’s initial plan for Fedi — to help move bitcoins from exchanges into self-custody with their owners — the company is using a federated custody model, or a multi-signature setup in which multiple “guardians” hold the keys to bitcoin funds.
Community members select people to be guardians, and these guardians run the Fedi software together so that trust is distributed among them. They are also in charge of safeguarding the community's bitcoins and minting electronic coins. Together, the guardians form a federation, a custodian model with no single point of failure.
“(Each tutor is) individually trustworthy, otherwise they wouldn’t be in those roles,” Nwosu said.
“The fact that two out of three or three out of five are required (to approve transactions) significantly increases trustworthiness. We see this way of working in organizations, businesses, governments, militaries and families time and time again,” he added.
“You can add more guardians to increase the level of redundancy and resilience.”
Guardians will also make decisions for their community on how to employ the different modules, or “mods,” that Fedi offers.
“Modules are a way to upgrade your Fedi with (more) capabilities,” Nwosu said.
For context, all Fedimints come with three modules: the bitcoin module, which provides federated access to bitcoin; the Lightning module, which provides communities with access to the Lightning network; and the Mint module, which offers users the ability to mint ecash.
Nwosu shared that there are also additional modules, one of which is a stability fund module, which provides what Fedi calls a “Stable balance” for assets.
By using the Stable Balance feature, communities can peg their bitcoins to the value of a fiat currency or the value of another asset, a particularly important feature for communities that may not want to endure bitcoin's volatility.
“Whenever there is a price relationship between bitcoin and an asset, a stability fund can be created to provide price stability to the asset,” Nwosu explained.
“It could be the US dollar, but it could also be the local currency. It could be gold. It could be Tesla stock. Each person will use it differently,” he added.
Open Source Fedi
You might think that a company that took the time to create a super app would want to keep that code secret.
But not Fedi.
The organization plans to publish its source code, which is already publicly auditable. Part of the organization’s motivation for doing so is to further gain the trust of the communities it serves, but it also has two other notable reasons for taking this step.
The first revolves around the company's philosophy.
“First and foremost, philosophically, our number one goal is to build a tool that takes the best of the freedom technologies that exist and merges them into one,” Nwosu explained.
“We believe that for many people, privacy and reliability are paramount when it comes to managing communications, money and more. The only way to ensure this is at the highest level is for Fedi to also become an open source company,” he added.
The other main reason has to do with following the trend in bitcoin and the broader free technology space.
“The second part is that we are part of the freedom technology community and the bitcoin community,” Nwosu said.
“Five years ago, the idea of open source would have seemed really strange, if not crazy, to an organization like ours. Our prediction is that within five years, it will be crazy to close source code, and we are seeing that transition,” he added.
“This is the future. We are just getting ahead of it.”
In a world where it will be much easier to replicate apps, Nwosu is not afraid that potential Fedi imitators will eclipse what the company has to offer.
“We realized that what is going to continue to have lasting power is the network effects and the human elements of the business,” Nwosu said. “So we built a business model that really leverages human networks, which are not so easy to replicate.”
Global adoption
While Fedi currently focuses most of its efforts on the Global South — which includes regions like Africa, Latin America and Southeast Asia — it has its sights set on “everyone, everywhere” eventually using it, according to Nwosu.
However, the company is starting with the Global South because it plans to first meet the needs of those who are often considered last, which will help it meet the needs of everyone.
“When you look at the pyramid of users and needs, if you focus on the highest percentage of users, it's going to be very difficult to reach a set of users who may have fewer resources, less assets,” Nwosu explained.
“If the car you're making is a Ferrari, it's very difficult to make it for everyone. But if the car you're making is a VW Golf, then it's very easy for someone who can afford something more than a VW Golf to still be using a VW Golf,” he added.
“If we focus on some of the most disadvantaged communities, we will end up with a product or tool that is useful for everyone, rather than useful (only for a) subset. If we want to reach the broadest funnel, we should try to reach as wide a reach as possible, which means we should start by focusing on the people we don’t normally focus on first, but rather the ones we focus on last.”
Furthermore, people are having a hard time managing and using their bitcoins all over the world, and Fedi's approach of providing human support to its users will help bitcoin do what it was designed to do, act as peer-to-peer electronic cash.
“You can’t just solve this with software,” Nwosu said. “If you want people to use this medium of exchange, you have to combine software and people.”
