One week after we reported that Facebook’s Libra stablecoin project, Libra, was imploding, as online payment giant PayPal quit the Libra network, we can now set the time of death to today – that’s when first eBay, then Stripe and finally Mastercard all abandoned Mark Zuckerberg’s pet “cryptocurrency” (which was anything but) project.
As the FT reports, Ebay and Stripe became the second and third major companies in a week to drop out of Facebook’s planned cryptocurrency, following sustained political pressure and just days before the project’s backers are due to meet for their first board meeting, which may soon be empty.
“We highly respect the vision of the Libra Association; however, eBay has 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 company spokesperson said in a statement to the Financial Times.
Echoing Ebay’s sentiment, payment group Stripe also pulled out, saying that “Stripe is supportive of projects that aim to make online commerce more accessible for people around the world. Libra has this potential. We will follow its progress closely and remain open to working with the Libra Association at a later stage.”
Hammering the final nail in the coffin of Zuckerberg’s attempt to become the world’s central banker, at roughly the same time the world’s biggest credit card processors, Visa and MasterCard also announced they are dropping out of the Libra coalition.
Echoing the apologetic statements of the other former Libra members, Visa said that while it continues to be interested in Libra’s blockchain work, it will not be joining the Libra association at this time, as it evaluates Libra for factors including regulation.
The decisions by these anchor companies, whose departure effectively kills Libra, are a death blow to Facebook’s plans for libra, the most ambitious attempt yet to get consumers to adopt a cryptocurrency to pay for goods and services on the internet, and follow intense scrutiny from regulators and politicians, some of which have called for the project to be stopped altogether, citing money laundering concerns and worries about wider financial stability.
Without a strong network of financial partners that could help transfer currencies into libra and global retailers to accept it as a form of payment, its reach would be non-existent.
Earlier this week we also learned that CEO Mark Zuckerberg is going to testify in front of Congress about the plans later this month, although at this rate he won’t have to: after all Libra is now dead.
The Libra alliance, a group largely made up of finance and technology companies, had each decided to put at least $10m behind the scheme. Members are meeting in Geneva on Monday to nominate the board for the project.
A Libra spokesperson told the FT that: “We look forward to the inaugural Libra Association council meeting in just three days and announcing the initial members of the Libra Association.”
At this point he may as well cancel it.