Is Libra Association Failing?
Only one week after PayPal left the libra Association, other key players have withdrawn as well. Visa, Mastercard, eBay, Stripe, and Mercado Pago have all withdrawn from the Association, dealing a major blow to Facebook’s plans for a distributed, global cryptocurrency.
The withdrawals leave Libra with no major US payment processor, which could be a serious issue for the fledgling project. “Visa has decided not to join the Libra Association at this time,” the Visa spokesperson told The Verge. “We will continue to evaluate and our ultimate decision will be determined by a number of factors, including the Association’s ability to fully satisfy all requisite regulatory expectations.”
“We highly respect the vision of the Libra Association,” eBay said in a statement. “However, eBay has made the decision to not move forward as a founding member. At this time, we are focused on rolling out eBay’s managed payments experience for our customers.” Stripe gave a similar explanation for its withdrawal. “Stripe is supportive of projects that aim to make online commerce more accessible for people around the world,” the company said. “Libra has this potential. We will follow its progress closely and remain open to working with the Libra Association at a later stage.” Mastercard did not immediately respond to a request for comment.
In response, Libra Association policy chief Dante Disparte thanked the companies for their ongoing support of the organization’s mission. “We are focused on moving forward and continuing to build a strong association of some of the world’s leading enterprises, social impact organizations and other stakeholders,” Disparte said. “We look forward to the inaugural Council meeting and announcing the initial members of the Libra Association.”
The remaining Libra members are facing growing pressure from governments and regulators, many of whom see the project as a threat to the existing financial system. On Wednesday, two Democratic senators urged Visa, Mastercard, and Stripe to reconsider their involvement with Libra, saying it could have significant regulatory consequences for any payment processor involved.
In response to the news, Libra chief David Marcus, a former president of former Libra Association, conceded the news was not “great in the short term,” but “liberating” to “know that you’re on to something when so much pressure builds up.” Marcus also casts the news of Mastercard and Visa’s withdrawal from the project as the two payment giants simply waiting until there’s proper “regulatory clarity” on Libra.