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PayPal Withdraws From Libra Association

Since its announcement, Facebook’s project Libra has been mangled in a battle with regulators and government authorities in the US.

The company’s representatives have been summoned before Congress, and many regulatory bodies have expressed a negative view of the project.

Facebook, along with a host of top tech and financial firms, is working on a digital currency that could be used as a medium of exchange across the world.

While the woes with regulators continue, the Libra Association has some internal challenges that have just appeared.

PayPal withdraws from Libra Association

PayPal, a payment processing giant, is one of the companies that were announced as Facebook’s partners in the project Libra.

This has changed following an announcement from the payments company on Friday. PayPal announced that it is no longer a participant in the Libra project.

The decision has raised several questions about whether PayPal has exited the project because it is in jeopardy due to failure to satisfy regulatory requirements.

According to a representative from PayPal, the company has left Libra in a bid to continue to focus on furthering its own mission and priorities in its business.

The representative added that PayPal wants to focus on creating equal access to decentralized financial systems for populations that are sidelined by traditional systems.

The company says that despite leaving the Libra Association, they remain supportive of the project, and they look forward to continued dialogue with Facebook on ways that the two companies could work together.

A spokesperson from the Libra Association confirmed that PayPal had notified the association of its intentions to exit the project.

Libra, a threat to global monetary order

Libra was first announced in June this year, and the project generated a lot of conversation in the crypto community and the broader financial sector.

The stablecoin that would come out of the project has the potential to entirely change the world’s financial systems and replace the US dollar as the primary medium of exchange on the world markets.

It also poses a threat to several fiat currencies, and many governments have responded by pre-blocking the stablecoin in their jurisdictions.

Finance ministers in France and Germany stated that they would block Libra from being used in their countries, and many US government officials have called for Facebook to be ordered to stop all work on the project.

The initial announcement of the project, which was done in June, revealed that Facebook was working with 27 partners. Uber, MasterCard, Spotify, and Visa are some of the big-name companies that are involved in the project.

PayPal’s announcement that it has pulled out of the project comes days before members of the association are supposed to meet and sign a charter that would elect the project’s governing body.

It is yet to be seen whether the association members will still meet on the 14th of October as scheduled or whether PayPal’s move will prompt a postponement of the meeting.

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      A journalist, with experience in web journalism and marketing. Ali holds a master's degree in finance and enjoys writing about cryptocurrencies and fintech. Ali’s work has been published on a number of cryptocurrency publications.