Embarassing ‘LitePay’ Episode Pulls Down Litecoin By 10%
In an apparent embarrassment to Litecoin Foundation, LitePay, which was showcased as Bitpay like payment processor, has shut down its operations. The announcement was made by the Foundation after Kenneth Asare, CEO of LitePay, contacted the former to inform the decision. Asare has offered the company for sale.
Notably, Litecoin Foundation had invested $50,000 in the startup, despite Asare’s previous venture was FTB suspended (action taken by Frachise Tax Board for failure to meet tax requirements).
The Litecoin Foundation had apologized to the community through a tweet.
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 Foundation had recently approached Kenneth to explain the community’s concerns over his non-transparent behavior and unimpressive ‘Ask me anything’ session on Reddit.
Kenneth, instead of trying to resolve the issue, had asked for more funds to continue operations. The Foundation refused further funding as Kenneth was unable to provide details of how and where the money was spent earlier. Kenneth was also unwilling to provide further details about the company and provide evidence to his statements. Kenneth pulled the plug when the Foundation refused to fund the anonymous venture again.
Litecoin started rallying in the first week of February after its founder Charlie Lee reminded about LitePay and also announced the planned launch of another merchant payment processor, named LitePal, later this year. At that time, Litecoin was trading at about $130. It reached a high of about $250 before making a trend reversal. Now, following the news, Litecoin has again fallen back to about $130 at the time of writing this article.