LitePay folds after Litecoin Foundation refuses to contribute more funds
Litecoin approached LitePay regarding transparency issues. Soon after, the payments company shut down.
LitePay, a prospective cryptocurrency payments startup, has ceased all operations, according to the Litecoin Foundation. The San Francisco-based business, which was founded in 2017, will reportedly be sold off.
In a recent announcement the Litecoin Foundation revealed that LitePay’s chief executive Kenneth Asare had informed the blockchain company of his decision to shut down the fledgling enterprise.
Prior to that, the foundation had approached Kenneth regarding his less than transparent nature with the company and to express our, and the community’s, concerns regarding his recent Reddit AMA. It was at this time that Kenneth asked the foundation for more funds to continue operations. The foundation refused any further funding as he was unable to provide a satisfactory picture of where the money had been spent and refused to go into exact details about the company and show objective evidence to back up his statements.
Litecoin Foundation on LitePay’s termination
Litecoin founder Charlie Lee apologized for supporting LitePay and assured users that the company was working hard to tighten due diligence practices to ensure that this kind of incident is not repeated in the future.
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
LitePay was designed to offer retail merchants the ability to accept Litecoin (LTC) for payments. In addition, the business also aimed to provide digital wallets and a LitePay debit card to instantly convert LTC into US dollars. In late February LitePay reported that merchant payment processing account registration was ongoing.
During a Reddit Ask Me Anything (AMA) session in mid-March, LitePay chief Kenneth Asare said that 6,500 merchants had applied for accounts and that the company was examining “just under 2,000” of them.
“What we are building is a compliant crypto merchant payment processor in the USA… That means for now, only supporting a very narrow range of merchants. That also means that as regulations unfold, we will be moving much slower than: 1. The number on coinmarketcap, and 2. Many other companies,” Asare said.
“We are running a marathon, with the full knowledge that we might not be smart enough, well funded enough, or working at the right time for any of that to matter. We will keep running for as long as we can because we think a world with borderless payments, and everyone with a cell phone being a bank matters.”
This week, international money transfer company Payza was accused of wittingly transmitting funds that were derived from illegal activity by the United States Department of Justice (DOJ), a violation of criminal laws. Payza allows users to send and receive traditional currencies, as well as a number of cryptocurrencies.
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