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PayPal withdraws from association overseeing Facebook's Libra cryptocurrency

Libra has faced regulatory scrutiny from lawmakers.

Facebook Libra Virtual Currency

Facebook and its partners plan to launch a new cryptocurrency called Libra in 2020. 

Thomas Trutschel via Getty Images

Payments company PayPal is withdrawing from an association made up of Facebook and other companies that are overseeing a new cryptocurrency called Libra, which is scheduled to launch in 2020.

The move by PayPal underscores the challenges that Facebook and its partners that are part of the Libra Association face as the group tries to get the cryptocurrency off the ground. 

"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 underserved populations," said Amanda Christine Miller, a spokeswoman for PayPal. 

She didn't say why the payments company is dropping out of the association. But she did note that PayPal supports the Libra Association's goals and will continue to partner with Facebook in other ways.

Libra, which is scheduled to launch in 2020, has faced regulatory scrutiny from lawmakers around the globe who are concerned it could be abused for money-laundering and other illegal activities. Facebook is also building a digital wallet, called Calibra, to store the currency.

Visa, Mastercard and other financial partners have been reconsidering their involvement in the effort after regulatory backlash, The Wall Street Journal reported this week. 

Dante Disparte, head of policy and communications for the Libra Association, declined to say if other partners are also withdrawing. The group said it has "no other member news to share at this time."

"This journey to build a generational payment network like the Libra project is not an easy path," he said in a statement. "We recognize that change is hard, and that each organization that started this journey will have to make its own assessment of risks and rewards of being committed to seeing through the change that Libra promises."

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