EBay, Visa and Mastercard pull out of Facebook's Libra cryptocurrency

EBay, Visa and Mastercard pull out of Facebook's Libra cryptocurrency

EBay, Visa and Mastercard pull out of Facebook's Libra cryptocurrency

On Tuesday (October 8), two senior U.S. Senators-Brian Schatz (D-HI) and Sherrod Brown (D-OH)-wrote letters to the CEOs of Visa, Mastercard and Stripe in order to share their "deep concerns" about Libra and the Libra Association because important questions about the risks posed by this project "remain unanswered".

This now makes six of the original 28 founding members pulling out, threatening to hamper an ambitious project by Facebook to remodel global finance even before it hits the ground running.

Libra, meanwhile, said it plans to soldier on. These include Mastercard and Visa, as well as eBay, Stripe and Mercado Pago.

Both corporations confirmed within the past hour or so they will withdraw from the Libra Association, joining PayPal, which pulled out earlier this week.

Speaking to the outlet, an eBay spokesperson asserted that while the company "respects the vision of Libra", the American firm will not be moving ahead with its participation in the Association, citing a focus on " rolling out eBay's managed payments experience for our customers".

In statements following their decision, the companies said that they were still interested in the cryptocurrency as a secure digital payment method, but have chosen to focus their resources on other projects for the time being.

"We appreciate Stripe, Mastercard and eBay's support for the goals and mission of the Libra project", he said. "We believe there are potential benefits in such initiatives and will continue to monitor the Libra effort". However, for now, they are distancing themselves from the Libra association and the unwelcome scrutiny that comes with it.

The company said it would have 100 members on the list by the time of Libra's launch, which is still planned for next year. France and Germany have vowed to block Libra altogether. Some people inside the company think the defections are partly driven by established payments providers worrying about a new entrant encroaching on their turf, the person said. Be that as it may, the timing could not be more flawless.

Losing four of its founding members certainly doesn't bode well for Libra's future, especially considering that Facebook doesn't plan on launching it until sometime during the first half of 2020. The cryptocurrency would be run out of Geneva by the organizations that comprised the Libra Association, not exclusively by Facebook. With this process, the new members will each have a specific role to play in the Libra Association.

PayPal bailed last Friday, and now eBay, Mastercard, and Stripe are tripping over each other on their way out the door.

Facebook CEO Mark Zuckerberg is scheduled to appear in front of the House Financial Services Committee later this month to discuss Libra.

PayPal also dropped out of talks to work with Facebook on Libra last week. Also, venture capital companies like Union Square Ventures and Andreessen continue to be involved, in addition to the crypto exchange platform Coinbase.

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