LitePay stops operations
A business enterprise which claimed it has developed special Litecoin-based debit cards has ceased to exist, as reported by several cryptocurrency-focused media outlets. This LitePay company can be called a startup, as it was founded only last year. The financial state of this organization and lack of business transparency are the main reasons of its collapse.
According to the Litecoin Foundation which initially provided LitePay with some funds for development, the company asked for more and when confronted about its actual business strategy and money management, it did not respond credibly.
The Litecoin Foundation thinks that the matter of financial aid for startups is serious. What if some other company tries to repeat this fraud scheme in the future? The statement left by the Foundation on its official website contains promises to develop a set of failsafe measures.
Charlie Lee, creator of Litecoin, has apologized on his Twitter and told that he will make sure that no startup will ever fool the Foundation again:
Like everyone else, we got too excited about something that was too good to be true and we optimistically overlooked many of the warning signs. I am sorry for having hyped up this company and vow to do better due diligence in the future. https://t.co/khIjeHnyZ1
— Charlie Lee [LTC] (@SatoshiLite) March 26, 2018
Litecoin’s price has lost 11% in 24 hours, but this does not seriously differ from other coins which lost from 5% (Bitcoin) to 20% (TenX) simultaneously. This means that the aforedescribed LitePay collapse has not influenced the price.