Mastercard, eBay, and Stripe have pulled out of the coalition of companies involved in a Facebook-led cryptocurrency initiative, Libra Association, in the latest headache for the social network’s effort. Other members could soon follow out the door, including Visa, amid fears of attracting regulatory scrutiny.
The news comes shortly after PayPal withdrew from the 28-member group that has been established to help build and maintain the Libra payments network. Other key partners that signed on earlier this summer to pursue a global cryptocurrency project were reportedly reconsidering their involvement.
“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,” a spokeswoman for eBay said.
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A spokesman for Stripe also noted, “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.”
The dominoes are falling
The founding members were expected to meet next Monday, but the defection of those could indicate the alliance is starting to collapse. They were also expected to invest $10 million each to fund the operating costs of the association, but none of those investments had yet been made.
Although crypto-native partners, like Coinbase and Xapo, may opt to stay on with the Libra Association, financial giants are increasingly wavering in their support as the embattled project continues to face queries from US and European regulators.
The first domino in Libra’s executive panel has also fallen. Chief Product Officer Simon Morris left the association yesterday in the shadow of a backlash from many governments’ authorities.