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PayPal is saying goodbye to Facebook's Libra, the first company to leave the project. The controversial cryptocurrency project is lead by Facebook, but the main way consumers will interact with Libra is through Facebook's sibsidiary, Calibra. To join this group, each of the 28 (now 27) companies involved had to pledge $10 million to help develop Libra.

Facebook and Libra
© Wit Olszewski / Shutterstock.com

The Guardian reported that PayPal didn't give a reason for leaving the project. In a statement, the payment provider said: "PayPal has made the decision to forgo further participation in the Libra association at this time and to continue to focus on advancing our existing mission and business priorities as we strive to democratize access to financial services for under-served populations. We remain supportive of Libra’s aspirations and look forward to continued dialogue on ways to work together in the future. Facebook has been a longstanding and valued strategic partner to PayPal and we will continue to partner with and support Facebook in various capacities."

Others Are Skeptical

PayPal doesn't seem to be the only company having second thoughts regarding Libra. According to a recent report by the Wall Street Journal, Mastercard and Visa are also getting cold feet about Facebook's cryptocurrency aspiration. This comes before a meeting scheduled for 14 October with representatives of the companies involved with Libra.

Regulations

Libra has also been under increased scrutiny from regulators, especially those in Washington and Brussels, where the project is viewed as an attempt to bypass rules on topics from money laundering to tax evasion. 

The French government has already said they would block development of Libra in the EU, with US regulators suggesting that the financial details of the currency, which would involve putting the value of one Libra against a basket of currencies held in reserve. This could bring the cryptocurrency under the scrutiny of securities regulators.