Facebook's attempt to create a cryptocurrency appears to be stillborn as major partners are pulling out of the project. PayPal backed out of the project recently, and now reports indicate most of the other major backers have walked away. Facebook has now lost the backing of Mastercard, Visa, eBay, and Stripe.
Regulators around the world have put the Libra project under a microscope for months. Facebook announced its Libra project in June and intended to have the cryptocurrency available in 2020. The plan was to integrate Libra into Facebook services and use the currency for e-commerce transactions on its platform and others.
Initially, there were several major backers of the project, and those partners were to create the Libra Association to be based in Geneva to oversee the cryptocurrency and development of its blockchain. Other members of the consortium included Uber, Lyft, Spotify, Vodafone, Mercado Paga, PayU, and others.
When Visa and Mastercard walked away from Libra, they did leave the door open to return in the future. Visa issued an official statement that read Visa has decided not to join the Libra Association at this time. It noted that it could evaluate the association in the future if Libra was able to satisfy all regulatory expectations. eBay said it had made the decision not to move forward as a founding member.
Stripe said it was open to working with Libra in the future, leaving it with no major payment processors left. The payment processors stepped away after receiving letters from two Democratic senators warning that if they moved forward, they could expect a high level of scrutiny from regulators, not only on Libra-related activities but on all payment activities. There has been no official announcement from Facebook on the subject. In other Facebook news, the social network continues to have issues with privacy. Its last major privacy row saw over 400 million phone numbers leaked.