Company Name: Fedi
Founders: Obi Nwosu, Justin Moon and Eric Sirion
Date Founded: June 2022
Location of Headquarters: 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 back, Obi Nwosu was running Coinfloor, a successful, long-running bitcoin exchange, out of the UK. But something irked Nwosu. He knew that he could be doing much more with freedom technologies like Bitcoin to help people around the world.
So, he and two partners founded Fedi, a company that’s recently released a “community superapp,” as Nwosu calls it, that provides an easy and private way to not only to manage money but to communicate digitally and meet the different needs of communities worldwide.
“We created Fedi because it solved a problem that 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 that were using [bitcoin] exchanges and give them a path to go from third parties to self-custody,” he added.
“We realized that the middle ground was community. If we could find a way to empower communities — to provide an offering which was as good, or in some ways better, than the centralized offerings that are by far still the [custodians that the] vast majority of people use, [and replace them with] parties who individuals trust more than they trust these third parties — that would be the path. That was the beginning idea, and the rest is history.”
To slightly alter Nwosu’s words, one might say that the rest is history in the making.
After over two years of developing the Fedi superapp, the company took it live on August 6, 2024. And what the app offers even in its first iteration is perhaps more than even Nwosu himself envisioned when he undertook the project.
What Is Fedi?
Fedi the 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 refers to as “freedom technologies” like Bitcoin, Lightning and Nostr. It also employs the Fedimint protocol, which enables users to share custody of bitcoin; utilize the Lightning Network; and mint ecash, digital tokens pegged to the value of bitcoin, fiat currencies or other assets that are used to preserve privacy in transactions.
Beyond that, it lets users send messages privately and has other functionalities, features and even other apps within the app — hence the term “superapp.”
“You don’t have to install multiple apps to get things done,” explained Nwosu. “[With Fedi,] you have one app and you can, in one place, do all the different things you need to do.”
Imagine having WhatsApp, Twitter and Venmo all in one app. This is what Fedi offers, albeit with different, more freedom tech-orien versions of messaging, social media and payment apps.
However, because some of this technology is new and difficult to use — particularly Bitcoin, Lightning and ecash mints — Fedi provides community support via the Fedi Order, composed of “Fedi Knights,” which serves as a “decentralized Genius Bar,” according to Nwosu.
“If you’ve got an iPhone and have a problem with it, you can go to an Apple store and walk up to the Genius Bar and someone who is knowledgeable can help you solve that given problem,” he said.
“We wanted to replicate that feel. That’s what the Fedi Order does. They provide on the ground community support, which you need if you want to take Bitcoin beyond expert users or enthusiasts,” Nwosu added.
This type of support is particularly useful for the guardians of Fedi communities.
Guardians And The Federated Custody Model
To accomplish Nwosu’s initial plan for Fedi — helping to move bitcoin off of exchanges and into the self-custody of its owners — the company utilizes a federated custody model, or a multisig setup in which various “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 dispersed amongst them. They’re also in charge of custodying the community’s bitcoin and minting ecash. Together, the guardians form a federation, a custodial model without a single point of failure.
“[Each guardian is] individually trustworthy, otherwise they wouldn’t be in those roles,” said Nwosu.
“The fact that you require two of the three or three of five [to sign off on transactions] increases your trustworthiness significantly. We see this way of working occur in organizations, companies, governments, military 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 regarding how to employ the different modules, or “mods”, that Fedi offers.
“Modules are a way of upgrading their Fedi with [more] capabilities,” said Nwosu.
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 gives users the ability to mint ecash.
Nwosu shared that there are also additional modules, one of which is a stability pool module, that provides what Fedi terms a “Stable Balance” for assets.
Using the Stable Balance feature, communities can peg their bitcoin to the value of a fiat currency, or the value of another asset — a particularly important feature for communities that might not want to stomach bitcoin’s volatility.
“As long as there is a price feed between Bitcoin and an asset, a stability pool can be set up to provide price stability to the asset,” explained Nwosu.
“That could be USD, but it could be the local currency. It could be gold. It could be Tesla stock. Different people will use it in different ways,” he added.
Open-Sourcing Fedi
One might think that a company that’s taken the time to build a superapp would want to keep that code under wraps.
Not Fedi, though.
It plans to open-source its code — code that’s already publicly auditable. Part of the organization’s motivation in doing so is to further Earn 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 of all, philosophically, our number one objective is to build a tool that takes the best of the freedom technologies out there and merges them into one,” explained Nwosu.
“We believe that for many people, privacy and being reliable is really key when it comes to something that’s handling your communication, money and more. The only way to ensure that is at the highest levels is for Fedi itself also to eventually become open-source,” he added.
The other main reason has to do with following the trend in the Bitcoin and broader freedom tech space.
“The second part is we’re part of the freedom technology community and Bitcoin community,” said Nwosu.
“Five years ago, the idea of open-sourcing [code] would have seemed really strange, if not crazy, for an organization like us. Our prediction is that in five years time, it will be crazy to be closed-source, and we’re seeing this transition,” he added.
“That is the future — we’re just getting ahead of it.”
In a world where it will be much easier to replicate applications, Nwosu isn’t afraid that potential Fedi copycats will eclipse what the company has to offer.
“We realized that the things that are going to still have enduring power are network effects and the human elements of your business,” said Nwosu. “So, we built a business model that really leverages human networks, which are not so easy to replicate.”
Global Adoption
Though Fedi currently focuses most of its efforts on The Global South — which includes regions such as 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 often considered last, which will help it to meet the needs of everyone.
“When you’re looking at the pyramid of users and needs, if you focus on the top percentage of users, it’s going to be very difficult for you to drive down to a set of users who maybe have less resources, less assets,” explained Nwosu.
“If the car you’re making is a Ferrari, it’s very hard to make that car for everyone. But if the car you’re making is a VW Golf, then it’s very easy for someone who can afford more than a VW Golf to continue to use a VW Golf,” he added.
“By focusing on some of the most disempowered communities, you end up with a product or tool which is useful for everybody, as opposed to useful [only for a] subset. When aiming for the widest funnel, you should try to go for the broadest reach you can, which means that we start focusing on the people who normally are not focused on first, but focused on last.”
Also, people are struggling to manage and use their bitcoin all over the world, and Fedi’s approach in providing human support for its users will help bitcoin do what it was designed to do, act as peer-to-peer electronic cash.
“You cannot just solve this with software,” said Nwosu. “If you want people to use this as medium exchange you have to solve a combination of software and people.”