Saturday 12 October 2019 11:09 am

Mastercard and Visa join Paypal and others in abandoning Facebook's Libra cryptocurrency project

Mastercard, Visa, eBay and Stripe have all pulled out of Facebook’s cryptocurrency project, Libra.

It comes a week Paypal announced they were withdrawing from Libra and is a huge blow to the social network’s plans to launch what it envisioned as a global currency.

Read more: Paypal become first firm to drop out of Facebook’s Libra project

Facebook chief executive Mark Zuckerberg is due to appear before the house committee on financial services on 23 October to discuss Libra.

It has been subject to intense scrutiny by regulators and politicians across the globe, but particularly in the US.

Among the concerns raised is the prospect of it being used for money laundering.

Of the six payments-related firms initially involved in the project, just one remains, with Mercado Pago also pulling out.

Netherlands-based PayU are the only firm left and are yet to respond to request for comment.

On Friday, eBay said respected the project but had “made the decision to not move forward as a founding member”.

“At this time, we are focused on rolling out eBay’s managed payments experience for our customers,” a statement said.

Both Visa and Stripe said they would continue to evaluate the situation as the project unfolded.

“Libra has this potential. We will follow its progress closely and remain open to working with the Libra Association at a later stage,” a Stripe spokesperson said.

A spokesperson for Visa said: “We will continue to evaluate and our ultimate decision will be determined by a number of factors, including the Association’s ability to fully satisfy all requisite regulatory expectations.”

The Libra Association said of the departing companies: “We appreciate their support for the goals and mission of the Libra project. 

“Although the makeup of the Association members may grow and change over time, the design principle of Libra’s governance and technology, along with the open nature of this project ensures the Libra payment network will remain resilient. 

“We look forward to the inaugural Libra Association Council meeting in just 3 days and announcing the initial members of the Libra Association.”

Facebook’s executive in charge of Libra said losing the firms was “liberating”.

Read more: Bank of England sets out strict rules of engagement for Facebook’s Libra

“I would caution against reading the fate of Libra into this update,” wrote David Marcus, who was formerly the Paypal president.

“Of course, it’s not great news in the short term, but in a way it’s liberating. Stay tuned for more very soon. Change of this magnitude is hard. You know you’re on to something when so much pressure builds up.”