Regulatory Backlash Against The Libra Association May See Founding Member PayPal Exit
Not only is Facebook’s cryptocurrency Libra is facing a backlash from regulators, but there is also news that PayPal is very close to leaving the 28-company coalition meant to help Libra gain legitimacy and come to fruition.
If PayPal leaves, it would be a blow to the proposed stablecoin and its legitimacy. The Libra effort is being led by David Marcus, an executive at Facebook and PayPal’s former president. The payments company is reportedly worried about all of the scrutiny and concerned that Facebook has not adequately addressed the issue of money laundering.
Bloomberg originally reported that PayPal, along with Visa, Mastercard, and Stripe, was “wavering over whether to officially sign on to the cryptocurrency project”, citing anonymous sources familiar with the matter.
Marcus Tweeted specifically over a Wall Street Journal report on companies considering leaving the project behind, “the tone of some of this reporting suggests angst, etc…”, Facebook and Calibra are working to “very calmly, and confidently working through the legitimate concerns that Libra has raised by bringing conversations about the value of digital currencies to the forefront.”
Since its announcement in June, the “unreleased crypto” has received a series of backlash from the United States of America, European Central Bank and the government of China who is all but convinced that the new project will destabilize currencies and bring in a digital currency war.
Companies that officially join the charter won't be obligated to immediately contribute an initial $US10 million ($14.9 million) required to invest in the project, according to two of the people. The move to get Libra members to formally sign-on is the latest indication that Facebook and its partners are pushing forward with the controversial plan, even after it came under fire from policymakers around the world.