Facebook Crypto Libra Crumbling as Visa, Mastercard Consider Quits: Report

Facebook’s cryptocurrency Libra has been in hot water ever since the social media giant released the whitepaper earlier this year. Central banks and governments across the globe have put together a concerted effort against Libra, putting Facebook executives in the dock time and again as they fear that the social media giant is out to create a parallel financial system.

But the greatest threat that could derail Facebook’s cryptocurrency project probably lies within. The Libra Association, a collection of organizations that is supposed to oversee the Libra cryptocurrency, is already cracking. The Wall Street Journal reports that payments heavyweights Mastercard and Visa, along with other financial partners, are having second thoughts about their involvement in Facebook’s cryptocurrency project. Citing people familiar with the matter, the Journal says that Mastercard and Visa are wary about the regulatory backlash Facebook Libra has been facing on both sides of the Atlantic.

They probably fear that providing public support to Libra could eventually suck them into regulatory scrutiny as well, and both Mastercard and Visa won’t want to attract such attention.  As it turns out, Visa and Mastercard aren’t the only ones who have started doubting Facebook’s cryptocurrency initiative. PayPal recently said that it is cautious about the future of Libra following rumors that the first backers of the Libra project were not happy with the regulatory attention that the initiative was attracting. But the report that Mastercard, Visa, and other financial partners such as PayPal are having second thoughts about Libra is concerning. That is because the project would be a dud if there are no financial partners to convert fiat into Libra and vice versa and transfer the same across the globe.