PayPal officially drops out of Facebook's Libra project

PayPal Withdraws Support of Facebook’s Libra CryptocurrencyCC0

While expressing continued support for Libra's "aspirations", Paypal said it made a decision to leave the global cryptocurrency club expected to consist of such big names as Visa, Uber, Lyft, and Mastercard.

Now, according to a PayPal spokesperson, the company has made a decision to discontinue its involvement with Facebook but might be willing to resume this partnership, probably if the regulatory flames are quenched. Nevertheless, different members of the Libra Affiliation, together with Visa and Mastercard, have been reluctant to publicly endorse the mission in current weeks.

Libra has yet to get off the ground, and setbacks like this, as well as promised scrutiny from regulators in regions like the United Kingdom, are sure to put a dampener on Facebook's ambitions.

Republicans and Democrats and even President Donald Trump have called for in various degrees for Facebook to be subject to USA banking laws - an arduous, complicated prospect - if the social media company does move forward with the Libra project.

Regulators and government bodies have been scrutinizing Facebook and its cryptocurrency with concerns over how a Facebook-backed and promoted currency could lead to anti-competitive behaviour.

What this means: For Paypal to walk away from Libra right now even before the project has been launched is a big blow to Facebook and the Libra Association in general.

Lawmakers in the House Financial Services Committee are seeking to bring Facebook's top executives to testify on libra before the committee, CNBC reported Friday. Along with privacy concerns, Waters has cited the potential for Libra to be used in money laundering and other financial crimes. In response, Facebook reportedly has hired several prominent Washington lobbyists.

However, Visa, Mastercard and other key financial partners that have agreed to help build and maintain Facebook's Libra payments network are having second thoughts about being involved with the social media company's proposed digital currency.

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