Libra Association Dealt A One-Two-Punch: Defections, And Now, The G7

October 14, 2019 | Digital Assets, Latest News, News

Last week, eBay, Visa, Mastercard, and Stripe followed PayPal out of the Libra Association; now, the G7 warns against digital currencies.

Last week, fears of regulatory uncertainty (and repercussions) probably forced eBay, Visa, Mastercard, and Stripe to depart the Libra Association. They followed on the heels of PayPal, which walked out earlier.

Meanwhile, the G7 is also likely to rain on digital currency Libra’s parade: a G7 draft report seen by the BBC said Libra should not be allowed to go ahead until it is proved that the cryptocurrency is safe and secure.

G7 taskforce weighs in on Libra

A G7 task force comprising senior officials from central banks, the International Monetary Fund (IMF) and the Financial Stability Board drafted the report.

The report said: “The G7 believe that no stablecoin project should begin operation until the legal, regulatory and oversight challenges and risks are adequately addressed.”

However, the report did not name Libra, which will be a stablecoin.

“Addressing such risks is not necessarily a guarantee of regulatory approval for a stablecoin arrangement,” the report added.

Payments giants depart Libra Association

PayPal’s decision to withdraw from the Association had a swift domino effect with other members from the payments industry following its lead.

[Related Story: PayPal is AWOL at Libra Association Meeting on Digital Assets]

“We highly respect the vision of the Libra Association; however, eBay has made the decision to not move forward as a founding member,” a company spokesperson told the Financial Times (FT). “At this time, we are focused on rolling out eBay’s managed payments experience for our customers.”

Said Stripe: “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.”

Globally, the Libra project has received significant regulatory pushback.

Recently, US Senators wrote to certain Libra Association members warning them for their participation in the Libra Association.

[Related Story: Senators strong-arm Visa, Mastercard, and Stripe on Libra: “…expect a high level of scrutiny.”]

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