Libra: PayPal Withdraws from Facebook’s Cryptocurrency Project

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Paypal pulls out of Facebook Libra Crytocurrency project

As a member of the consortium of partners including Visa and Mastercard, the group, Paypal had planned to invest at least $ 10 million in the Facebook Libra Cryptocurrency project.

The growing opposition of many players and regulators to Facebook’s future virtual currency has finally defeated the willingness of a major investor to participate. PayPal has announced Friday its decision not to take part in the digital currency project, the Libra , whose launch is scheduled for mid-2020. For the moment, the consortium of partners includes Visa and Mastercard. Based in Geneva, he was entrusted by Facebook with governance and project management.

A lack of preparation work with financial regulators

PayPal, which was to invest at least $ 10 million in the project, as each member of the association, did not give the reasons for his change of mind. “We continue to focus on our mission and our strategic priorities: to democratize access to financial services for underserved populations,” the group said. A source close to the company told the Financial Times that it “seems that there has been little preparatory work done with financial regulators” and that payment services such as Paypal did not want ” see regulators’ attention spilling over their business. ” “We remain supportive of Libra’s aspirations and look forward to continuing the dialogue on ways to work together in the future,” said PayPal.

Libra is expected to offer starting in the course of 2020 a new payment method outside the traditional banking channels, to buy goods or send money as easily as an instant message. But the project was quickly criticized by many regulators and governments around the world. They are particularly worried about Facebook’s bad reputation for privacy and protection of personal data. In July, the US Finance Minister Steven Mnuchin has issued a warning to Facebook, the government fears that such virtual currency is used to launder money or deceive the tax.

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