Facebook’s future cryptocurrency took a major blow earlier this month when PayPal bailed out of its participation in the social media’s Libra project. Though it was only one of the original 28 companies involved, PayPal’s presence lent a huge amount of financial confidence to the project.
“We remain supportive of Libra’s aspirations and look forward to continued dialogue on ways to work together in the future. Facebook has been a longstanding and valued strategic partner to PayPal and we will continue to partner with and support Facebook in various capacities,” stated PayPal regarding their decision.
PayPal was also not the last company to jump ship. MasterCard and Visa exited the Libra Association on October 11th, shortly followed the same day by payments platform Mercado Pago. Stripe and eBay have also left the project.
A MasterCard spokesperson said, “MasterCard has decided it will not become a member of the Libra Association at this time. We remain focused on our strategy and our own significant efforts to enable financial inclusion around the world. We believe there are potential benefits in such initiatives and will continue to monitor the Libra effort.”
Regulators around the world have voiced serious concerns regarding Libra, and lawmakers have continually been skeptical of Libra due to data and privacy concerns that have perpetually plagued Facebook. Others have expressed fears over regulatory backlash from participation in the Libra project.
Facebook CEO Mark Zuckerberg is set to testify this Wednesday, October 23rd, before a full Committee of the House Financial Services at 10 am. He will be the only witness during the hearing entitled “An Examination of Facebook and Its Impact on the Financial Services and Housing Sectors.”
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