United States Treasury Secretary Steven Mnuchin has attributed the recent spate of firms abandoning Facebook’s Libra stablecoin project to regulatory concerns.

On CNBC’s Squawk Box on Oct. 14, Mnuchin stated that companies are abandoning the Libra project because it is “not up to par” with American Anti-Money Laundering standards, saying:

“If they don’t meet the standards of our money-laundering standards and the standards that we have at FinCEN, we would take enforcement actions against them. I think they realized that they are not ready, they are not up to par and I assume some of the partners got concerned and dropped out until they meet those standards.”

A demarche to the Libra Association

Mnuchin's statement comes a few days after Visa, eBay, Stripe and Mastercard all announced that they are dropping out of the Libra Association, the stablecoin’s governing body, saying that they had chosen to redirect their focus for the time being.

Prior to that, major payment processor PayPal announced its withdrawal from Libra, as regulators continue to scrutinize the project. A spokesperson for the firm told Cointelegraph that it officially left the association, adding:

“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.”

At the same time, Coinbase CEO Brian Armstrong criticized U.S. senators for asking Stripe, Mastercard and Visa to leave Libra. “Something feels very un-American about this. Two senators writing to Visa, Mastercard, and Stripe to ask them to withdraw from Libra,” Armstrong wrote.

Announced this summer, Libra would ostensibly serve as a payment instrument for the user base of Facebook and its associated services like Instagram. Since its announcement, it has been the subject of scrutiny from regulators and lawmakers, who are concerned about its possible effect on global trade, finance and monetary sovereignty.