Initially a 28 corporate-member project, Facebook’s Libra Association recently saw the likes of eBay, Stripe, Mastercard, and Visa leave the project. The aforementioned four parties announced their decision to back out on Friday, October 11, 2019, a week after PayPal abandoned the ship! As reported by CNBC, the former members have since argued that this was not because they didn’t see potential in the project, but more so because they have other efforts that require more focus.
Some companies had a representing spokesperson giving reasons as to why leaving was the best thing to do. First, we have Stripe, who claims to still be supportive of the endeavor and, by the statement made, might have felt that the timing was poor. In particular, they would “remain open to working with the Libra Association at a later stage.”
As for Visa, they appear to have been more direct as to why they backed down. It appears just like Stripe, Visa isn’t shutting down the Libra Association completely, but instead want to be reassured that the association has the “ability to fully satisfy all requisite regulatory expectations.”
Here is what a company spokesperson told CNBC about Visa’s stance:
“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. Visa’s continued interest in Libra stems from our belief that well-regulated blockchain-based networks could extend the value of secure digital payments to a greater number of people and places, particularly in emerging and developing markets.”
It seems like the aforementioned four companies felt comfortable after PayPal decided it wasn’t for them to be part of the Association. PayPal’s reason for backing out appears to reflect that of Visa’s decision as well, as both firms appear to fear of the consequences that stem from not successfully meeting the requirements of regulations.
At the time of withdrawal, PayPal said:
“We remain supportive of Libra’s aspirations and look forward to continued dialog on ways to work together in the future.”
Since hearing about PayPal’s decision, the Libra Association issued a statement in which it was emphasized that the goal of changing the financial system that society has always been accustom to requires commitment, and if members cannot uphold that, it’s best to know now rather than later.
In response to losing four other members, Libra Association’s Policy Chief, Dante Disparte expressed gratitude in knowing that the firms will remain supportive reports The Verge, adding that:
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 to achieve a safe, transparent, and consumer-friendly implementation of a global payment system that breaks down financial barriers for billions of people. We look forward to the inaugural Libra Association Council meeting in just 3 days and announcing the initial members of the Libra Association.”
Interesting times we live in! Now all attention shifts to October 23 where Mark Zuckerberg will appear in front of Congress to testify about Libra and its future.
@Libra_ members backing out, presumably bc of regulatory stonewalling in DC & abroad.
SEC coming after @telegram for unreg securities offering.
Governments are realizing they’re losing their monopoly on money creation & they don’t like it at all.
This is The Trust Revolution.
— Travis Kling (@Travis_Kling) October 11, 2019
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