Wednesday, October 28, 2020

Senators warn Visa, Mastercard and Stripe for their involvement in Libra

The Takeaway:

Facebook' Libra was facing backlash from government organizations and central banks, but now even the supporting companies have cold feet. PayPal decided to back out from the project, and Visa and Mastercard decided not to support it publicly. Senators have suggested these companies to be careful with their involvement in the project and beware of the risks involved in this.

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Libra is having a hard time focusing on their launch as more and more problems come their way. The regulators and government institutions were already giving them a hard time by requesting for more details on the project and asking other questions.

Things took a different turn when the backing partners of the project started to have cold feet. Last week, PayPal decided to step back from the project, whereas Visa and Mastercard informed that they will not support the platform publicly anymore. Some senators have suggested the backing firms– Visa Inc., Mastercard Inc., and Stripe Inc., to reconsider their involvement in Facebook’s proposed Libra digital currency.

Senator Sherrod Brown of Ohio and Senator Brian Schatz of Hawaii wrote a letter to these firms and informed them about the risks that are involved in this partnership with Libra. They also added how some of the members of the company have struggled to get adequate information from Facebook about the project.

With such shady behavior, the regulators are afraid that Libra might pose to facilitate criminals and terrorist financing, interfere with monetary policy, or exposing consumers to certain risks. The senators have asked the companies to understand these risks and discuss how they would deal with this system. Currently, Libra has 27 members supporting the project as they try their best to convince the lawmakers.

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Disclaimer: The article reflects the opinions of the author and is not representative of Chaintimes’ views.
The article does not offer any investment advice. User discretion is advised when investing in or trading with cryptocurrency. Extensive and diligent research should be carried out by the reader before making a decision.

Dorsey Gray
Dorsey Gray
Dorsey works in the oil and energy industry since he graduated as a mechanical engineer from Bagdad Senior High School. However, he loves to explore and write about the financial world while he sits in the balcony of his beachside room. Dorsey also loves to cook, but just for himself.

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