Technology 3 min read

Paypal Withdraws From Facebook's Libra Cryptocurrency Project

A prominent member of Facebook's Libra cryptocurrency project, Paypal, has announced that it's pulling out from the said ambitious project.

Image courtesy of Shutterstock

Image courtesy of Shutterstock

PayPal has become the first company to pull out from Facebook‘s Libra cryptocurrency project.

Back in June, Facebook secured the support of major international financial institutions in developing a crypto-based payment system called Libra. Along with a pledge to build and operate services around the cryptocurrency, these multinationals are also to invest $10 million to be part of the Libra Association.

Now, a prominent member of the association is pulling out before the project gets off the ground. In a recent announcement, PayPal said that it would forgo further participation in the Libra cryptocurrency project.

The online payment platform wrote in its statement to the press:

“PayPal has decided 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.”

In its email to TechCrunch, PayPal said that it would continue to support and partner with Facebook in the future – but without being part of the Libra association.

Others To Withdraw From Libra Cryptocurrency Project?

Although Paypal may be the first to have pulled out from Facebook’s cryptocurrency project, the online payment platform may not be the last. According to a Wall Street Journal report, other companies like MasterCard and Visa are on the fence about being part of the association.

Visa’s CEO, Al Kelly, issued a public statement that its involvement in the project was only provisional.

The chief executive wrote in a recent company earnings call:

“So we have signed a nonbinding letter of intent to join Libra. We’re one of – I think it’s 27 companies that have expressed that interest. So no one has yet officially joined. We’re in discussions, and our ultimate decision to join will be determined by several factors, including obviously the ability of the association to satisfy all the requisite regulatory requirements.”

The keyword here is “requisite regulatory requirements.”

Since Facebook announced Libra back in June, the project has been under increasing scrutiny from regulators across the world. That’s especially true in Brussels and Washington, where the Libra cryptocurrency project is seen as a way to encourage money laundering and tax evasion.

Be that as it may, the social media behemoth appear unfazed by the lack of commitments. In a statement to the press, Libra Association described the cryptocurrency as “a generational opportunity to get things right and improve financial inclusion.”

“Commitment to that mission is more important to us than anything else.” the association said. “We’re better off knowing about this lack of commitment now, rather than later.

Read More: New India Law Proposes Ten Years Jail Term For Using Cryptocurrency

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Sumbo Bello

Sumbo Bello is a creative writer who enjoys creating data-driven content for news sites. In his spare time, he plays basketball and listens to Coldplay.

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