Paypal announced after being the only Libra backer to not show up at their meeting that they are quitting Facebook’s Libra currency, according to CNBC.
Yesterday, the Financial Times reported that Paypal didn’t show up to the Libra association’s meeting about regulation pressure. 28 backers of Libra were supposed to meet in Washington to discuss future plans for the Libra cryptocurrency, but only 27 showed up.
How we got here
An interesting fact about the Paypal – Facebook relationship is that David Marcus, who is in charge of Libra used to be Paypal’s president. During Facebook’s congressional hearings, one of the main points of contention was that the coin would be very powerful companies making a currency under the guise of crypto.
In reality, Libra was quite the opposite of decentralized, which gave them very little credibility in the crypto space. Mainstream consumers who aren’t as familiar with blockchain still tend to consider it a cryptocurrency, but many others don’t.
Still with the government and crypto advocates second guessing Libra at every step, Marcus was confident.
“We believe strong regulatory oversight preventing the Libra Association from deviating from its full 1:1 backing commitment is desirable,” Marcus clarified in a Twitter thread.
The Financial Times reported that at least three members of the Libra Association were not fond of regulations.
Why more companies might want to leave
Because of reports that Paypal isn’t the only company scared of regulators, people are expecting more to quit the Libra Association.
After regulators analyzed Facebook’s plans with a critical eye, they also began to look at their acquisitions. Members of the Libra Association likely do not want the negative attention from regulators that Facebook is bringing upon themselves.
President Trump also tweeted negatively about Libra, implying that they are in the business of becoming a bank and will be treated as such. Libra members all got in before criticism by government and may not have expected it all to play out like this.