Visa, MasterCard, eBay, Stripe, and Mercado Pago officially left the Libra association Oct. 11, following Paypal’s departure a week before.

“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,” said Visa’s official rep.

According to Paypal’s statement released last week, the company decided to “forgo further participation in the Libra Association at this time,” and it will “continue to focus on ..<> business priorities.”

Despite the stream of bad news, the co-creator of Libra and former president of Paypal David Marcus has cautioned “against reading the fate of Libra into this update,” adding that it might not look like good news right now, but “in a way it’s liberating.” He also thanked MasterCard and Visa for sticking out “until the 11th hour” during the tremendous pressure from the public and regulators.

 

Other founding members are, reportedly, staying in the Libra consortium and expected to meet on Monday, October 14, in Geneva to discuss further leadership of the project.

False Start

The social media giant announced its plans to launch Libra, “a simple global currency and financial infrastructure that empowers billions of people” in June 2019. The company also revealed 28 “founding members” of the Libra Association, including companies like Uber, Andreessen Horowitz, Vodafone Group, Thrive Capital, Lyft, etc.

The currency’s white paper calls the Association “independent, not-for-profit membership organization headquartered in Geneva, Switzerland.” Each member has contributed a minimum 0f $10 million and has an equal vote, while Facebook maintains “a leadership role through 2019.”

Libra hoped to attract up to 100 members by the launch in the first half of 2020.

The tech giant’s ambitious plans were welcomed by criticism, especially among the regulators around the world. Jeromy Powell, Federal Reserve Chairman, said “Libra raises serious concerns regarding privacy, money laundering, consumer protection, financial stability,” just weeks after the official announcement. 

Amidst increasing scrutiny Mark Zuckerberg, the CEO of Facebook, will be testifying before the House Financial Services Committee on Oct. 23.

The Committee Chairwoman Maxine Waters previously wrote a letter to Zuckerberg, Sheryl Sandberg, COO of Facebook, and David Marcus, calling to postpone the launch of the digital currency.

On top of the ongoing legal issues, a lawsuit was filed against Libra and Calibra, a digital wallet, for trademark infringement in New York Federal Court on Oct 11.

The price of Facebook’s stocks seems not to have been affected by the news.

Image source: Google Finance.