Exodus from Facebook's Libra digital currency as Visa, Mastercard and other backers quit

Telegraph 11 Oct 2019 07:57

Five payments companies led by eBay, Mastercard  and Visa have abruptly dropped out of Facebook's project to create a new digital currency, Libra, dealing a major blow to the social network's plan.

The companies, which also included the US payments firm Stripe and the Latin American Mercado Pago, announced that they were cutting ties just days before a crunch meeting on Monday which was expected to definitively establish the project's founding members. 

It follows Paypal's announcement earlier this week that it would not be joining, despite initially being listed as a "founding member" on the hook for a $10m membership fee. 

That removes six of the 28 intended "founding members" of the Libra Association, the independent governing body set up by Facebook to govern the currency and reassure critics that it would not be controlled by Facebook itself.

The drop-outs constitute a serious danger to Facebook's hopes of spreading the currency across the world, diminishing the heft of the Association as an independent body and therefore its utility as a shield against politicians and regulators.

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