MasterCard, eBay join PayPal in exiting Facebook's cryptocurrency Libra

L is for loser

eBay, Visa and Mastercard pull out of Facebook's Libra cryptocurrency

Mastercard, Visa, eBay and Stripe are all dropping out of Facebook's Libra payments network, according to reports, putting Facebook's proposed entry into the cryptocurrency market in peril.

In a statement on Friday, EBay expressed its support for the project, but said it would focus on rolling out its own payments products. Payment processing company Stripe is stepping back, as well as e-commerce company eBay.

With these withdrawals, Libra is left with no major United States payment processor.

Losing four of its founding members certainly doesn't bode well for Libra's future, especially considering that Facebook doesn't plan on launching it until sometime during the first half of 2020. Also, representatives from the companies will appoint a board of directors for the Libra Association at the meeting.

The impact of Libra's loss of Visa and Mastercard can not be understated. Today, in quick succession, eBay, Stripe, Mastercard and Visa all confirmed they are bowing out as well.

Facebook CEO Mark Zuckerberg will testify before the House Financial Services Committee on October 23, where he is likely to face more tough questions regarding Libra. That committee is chaired by Rep. Maxine Waters, D-California, who has been an ardent critic of Libra from its onset.

Facebook's digital currency alliance lost more companies on Friday amid heavy criticism from regulators around the world on the planned Libra global cryptocurrency.

Gartner analyst Avivah Litan said that while the defections are "a big setback" for Facebook and Libra, they won't kill the project.

With the recent departures, Libra's membership now consists mostly of venture capital firms and nonprofits.

Companies nearly queued up when Facebook announced plans to launch its global cryptocurrency in 2020. Vodafone, the Europe-based telecommunications company that has a substantial presence in Africa and has specialization in mobile payments, was also still listed as a member.

Payments company Stripe also pulled out, but left the door open to rejoining the Libra project, saying it would "follow its progress closely". "We urge you to carefully consider how your companies will manage these risks before proceeding, ' they said a letter to the companies".

Libra chief David Marcus in a tweet thanked Visa and Mastercard "for sticking it out until the 11th hour".

"We highly respect the vision of the Libra Association; however, eBay has made the decision to not move forward as a founding member", the company said in a statement.

Latest News