Libra loses support from MasterCard, Visa, eBay and Stripe according to reports from multiple news sites. This follows PayPal’s exit last week.
In a major setback to Facebook’s Libra Cryptocurrency, more major partners have backed out of the network. According to multiple news sources, MasterCard, Visa, eBay and Stripe has all pulled out of the Libra Association. They have not ruled out any future collaboration with Libra however.
The news was reported by Bloomberg, Financial Times and The Verge. The main contention is that members will soon be required to pay $10 Million to be aprtners in the Libra Association. After facing regulatory issues with Libra, Facebook has been quelling rumours that partners were backing out of the Libra Association. With the exit of Paypal last week, the rumours came back to haunt Facebook. With the recent news of 4 more partners exiting the association confirms the rumours. The partners have voiced concern over the progress of Libra so far and even questioned whether it will even be viable to launch.
While Facebook has put on a brave face and CEO Marcus has published multiple tweets calling for cooler heads, the company has a tough time ahead. Libra was meant to replace the traditional money exchanges of the world. With major payment gateways backing out, the possibility of a seamless experience can also be ruled out. However, Facebook may still recover from this and the partners that have left may join them again. This time with monetary contribution.
Statements from the News
While Mastercard has yet to offer any comment regarding the news, Visa, eBay, and Stripe have spoken out. Starting first with Visa:
Visa has decided not to join the Libra Association at this time. 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. 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.
As for Stripe’s stance on things:
Stripe is supportive of projects that aim to make online commerce more accessible for people around the world. Libra has this potential. We will follow its progress closely and remain open to working with the Libra Association at a later stage.
Dante Disparte, Libra Association Policy Chief, responded to the news as well, saying:
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. We look forward to the inaugural Libra Association Council meeting in just 3 days and announcing the initial members of the Libra Association.
“If you take this on,” the letters read, “you can expect a high level of scrutiny from regulators not only on Libra-related activities, but on all payment activities.”-The Verge
In response to the news, Libra chief David Marcus, a former president of former Libra Association, PayPal, 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.