“Open Source” Money; Disruption Requires Breaking Some Rules

This article on Mastercard’s withdrawal from the Libra project is interesting reading if you’ve been following the “open source” money ideas. Libra was launched with a bunch of fanfare and equal parts skepticism, but the backing of large companies like Mastercard implied a seriousness and stability that would be needed to get it off the ground.

One of the reasons it’s reported that MasterCard pulled out is because the Libra project couldn’t provide a clear, hard commitment to comply with “local” laws and regulations in every government zone, municipality, and state where it would operate. This is important when there are issues around data management, privacy, and accessibility.

But, I’d guess the real reason is more like this:

Analysts also fret that as digital wallets such as Apple Pay or India’s Paytm gain traction, and more transactions are conducted on big tech platforms such as those belonging to Google or Amazon, Mastercard’s place in the payments ecosystem will become less prominent.

You can’t make mega innovations like Libra work without breaking some rules and facing down your own existential crisis. (Unless you’re Jack Dorsey)

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