Would-be Litecoin merchant processor LitePay has abruptly terminated its operations, the Litecoin Foundation announced in a post on its website on Monday.
LitePay – which also claimed it would offer a crypto wallet and “LitePay debit card” through which users could convert litecoin into U.S. dollars – was unveiled in December of 2017 and set to launch in February of this year. Data from OpenGovUS shows that LitePay Inc. started operating on February 1.
The proposed business venture had won plaudits from the Foundation previously, which took to Twitter in December to write: “Finally, someone is taking the opportunity to create litepay.us. Good job!”
However, as of February 26, LitePay had only started to roll out its merchant service, according to a post on Twitter. The last public messages from the company related to a mid-March Ask Me Anything session on Reddit, and an email account listed on LitePay’s website did not reply to a request for comment by press time.
The foundation, which oversees development of the cryptocurrency, said in its post that it contacted the business’ founder and CEO, Kenneth Asare, following the AMA on March 16, expressing concerns regarding the “less than transparent nature” of LitePay. It was then that Asare revealed that he had decided to halt operations and planned to sell the company.
The Foundation’s post further explained:
“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.”
Both the Foundation and litecoin founder Charlie Lee expressed regret for their support of the project.
“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,” Lee wrote on Twitter. “I am sorry for having hyped up this company and vow to do better due diligence in the future.”
The Litecoin Foundation made a similar statement in its post:
“We are greatly disheartened that this saga has ended in this way and we apologize for not doing enough due diligence that could have uncovered some of these issues earlier. We are currently working hard to tighten our due diligence practices and ensure that this does not happen again.”
Nonetheless, the Foundation struck a hopeful tone.
“Litecoin was doing perfectly fine before the promise of LitePay and will continue to do so,” it said.
Litecoin image via Shutterstock