Facebook launched its own cryptocurrency back in June this year which was then backed by Mastercard and Visa, along with eBay, PayPal, Stripe, Spotify, Uber, etc. It turns out that all these payment firms have bailed on Facebook’s Libra project, in unison.
On October 4th, Paypal was the first to exit Libra Soon, others like Visa, Mastercard, Stripe and Mercado Pago, eBay followed the suit, after a few hours on October 11th. It suffices to say that every significant US payment processor has exited the association, albeit PayU hasn’t confirmed its stance yet.
Another breaking news is that all the founders are attending the first-ever Libra Council meeting in Geneva next week; at least who’s left. US President Donald Trump tweeted that Facebook should be subject to U.S. banking laws if the Libra project were to move forward.
“If there was any ambition to scale Libra very quickly and make it widely accepted, they would have been able to do that through Visa, Mastercard, and PayPal. Now it’s going to be a bigger challenge,” said Sanjay Sakhrani, a payments industry analyst at the investment bank Keefe, Bruyette & Woods.
Facebook CEO Mark Zuckerberg will appear in front of the House Financial Services Committee to discuss Libra. That committee is chaired by Rep. Maxine Waters, D-California, who has been an ardent critic of Libra from its onset.
Libra co-creator David Marcus was not backing down either, despite Visa and Mastercard’s departure. “The pressure had been intense (understatement), and I respect their decision to wait until there is regulatory clarity for Libra,” Marcus said.