PayPal Pulls Out Of Facebook’s Libra Cryptocurrency Network

October 6, 2019 in News by RBN Staff

by Tyler Durden

Facebook’s Libra stablecoin project is imploding.

Just days after the Wall Street Journal reported that credit card titans Visa and Mastercard, who had initially agreed to back Facebook’s Libra, are reconsidering their involvement following a backlash from U.S. and European government officials, late on Friday e-payment giant Paypal also announced it was withdrawing from the group of companies Facebook had assembled to launch the global cryptocurrency-based payments network, dealing a blow to the social-media giant’s ambitions to overhaul financial services

While Paypal didn’t cite a specific reason, it said it “made the decision to forgo further participation in the Libra Association at this time and to continue to focus on advancing our existing mission and business priorities as we strive to democratize access to financial services for underserved populations.”

 “We remain supportive of Libra’s aspirations and look forward to continued dialogue on ways to work together in the future,” the statement continues. “Facebook has been a longstanding and valued strategic partner to PayPal, and we will continue to partner with and support Facebook in various capacities.”

In a statement given to The Verge, Dante Disparte, the Libra Association’s head of policy and communications, reaffirmed the nonprofit’s commitment to “build a generational payment network. Disparte also confirms that an upcoming council meeting on October 14th in Geneva, Switzerland, where the Libra Association’s headquartered, is still on:

Building a modern, low-friction, high-security payment network that can empower billions of financially underserved people is a journey, not a destination. This journey to build a generational payment network like the Libra project is not an easy path. We recognize that change is hard, and that each organization that started this journey will have to make its own assessment of risks and rewards of being committed to seeing through the change that Libra promises. We look forward to the first Libra Council meeting in 10 days and will be sharing updates following that, including details of the 1,500 entities that have indicated enthusiastic interest to participate.

PayPal’s departure is not exactly a shock: on Thursday the Financial Times reported that PayPal had begun distancing itself from the project amid increasing regulatory scrutiny. The company reportedly signaled its intention to skip a meeting in Washington, DC scheduled for today, and as the Verge notes, at least one primary concern for PayPal has been the lack of attention Facebook executives have paid to Libra’s considerable backlash. Another key concern is how the platform will combat money laundering activity.