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Payments giants abandon Facebook’s Libra cryptocurrency

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Payments giants abandon Facebook's Libra cryptocurrency

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Facebook said it expected to launch Libra in 2020

Mastercard, Visa, eBay and payment company Stripe have withdrawn from Facebook's cryptocurrency project Libra.

Their change, first reported in the Financial Times, follows PayPal's withdrawal, announced last week.

This is a big blow to the social network's plans to launch what it imagines as a global currency.

The project attracted strong scrutiny from regulators and politicians, particularly in the US.

Facebook chief executive Mark Zuckerberg will appear before the House Financial Services Committee on October 23 to discuss Libra and its planned launch.

Regulators have raised several concerns about Libra, including the risk that it will be used for money laundering.

Mercado Pago, a payment company that serves mainly Latin America, has also given up. This means that of the six payment-related companies first involved in Pound, only one, PayU, remains. PayU from the Netherlands did not respond to the BBC's request for comment on Friday.

In a statement issued Friday, eBay said it "respected" the Libra project.

“However, eBay has made the decision not to move forward as a founding member. We are currently focused on implementing eBay's managed payments experience for our customers. "

A Stripe spokesman said the company supported the goal of facilitating global payments.

"Libra has this potential. We will closely monitor its progress and remain open to working with the Libra Association at a later stage."

A Visa spokesman said: "We will continue to evaluate and our final decision will be determined by several factors, including the ability of the Association to fully meet all required regulatory expectations.

The Libra Association, created by Facebook to manage the project, said of the departing companies: "Thank you for supporting Libra's objectives and mission.

"While the membership of the Association may grow and change over time, Libra's governance and technology design principle, along with the open nature of this project, ensures that Libra's payment network remains resilient.

"We look forward to the inaugural Libra Association Council meeting in just 3 days and will announce the initial members of the Libra Association."

The Facebook executive in charge of his Libra effort tweeted that losing businesses was "liberating."

"I would recommend not reading Libra's fate in this update," wrote David Marcus, who before joining Facebook was president of PayPal.

"Of course it's not good news in the short term, but in a way it's liberating. Stay tuned for very soon. Change of this magnitude is difficult. You know you're ready for something when so much pressure builds up."

Last week, PayPal said it would no longer be part of the Libra Associationbut did not rule out working on the project in the future – provoking a strong reaction from the Association.

"Commitment to this mission is more important to us than anything else," he said in a statement. "We are better aware of this lack of commitment now."

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