Litecoin went on a roller coaster ride on Monday after a bogus news release advertising a relationship with Walmart publishes and withdrawn. The cryptocurrency rose by as much as 33% before losing all of its gains in less than an hour.
Wal-Mart CEO Doug McMillon quotes in the false Globe Newswire press release as announcing the corporation will start accepting Litecoin as payment across all e-commerce sites.
A Walmart official questioned the authenticity of the news shortly after it hit the wires.
The Litecoin Foundation is a non-profit organization that promotes the use of Litecoin. As well as financially supporting the Litecoin protocol’s core development team, questioned this as well.
Similarity to Bitcoin
Litecoin is a Bitcoin fork with a capped supply and a proof-of-work consensus method. On the other hand, It means to process transactions four times faster than Bitcoin.
Litecoin was founded in 2011, three years after Bitcoin when cryptocurrencies weren’t popular.
This has faded in favor of smart contract platforms like Ethereum and Solana. Along with the apps and digital assets created on top of them.
According to CoinMarketCap, Litecoin had a market value of $12.1 billion as of this writing. Making it the 14th biggest cryptocurrency. However, the coin’s values are still significantly below their all-time highs, which sets in 2017 and again this spring.
This new Litecoin episode confirms some doubters’ suspicions that cryptomarkets are prone to manipulation. Last month, Securities and Exchange Commission Chairman Gary Gensler compared sections of the crypto space to the “Wild West,”. And it’s these fears of manipulation that have kept the SEC from approving a bitcoin ETF in recent years.
Others argue that while there are scams and manipulation in the crypto field, well-known currencies like bitcoin, ether, and Litecoin excludes.
In this scenario, it appears that whoever submitted or approved the press release was at fault. Furthermore, comparable frauds involving U.S. stocks have occurred; the spreading of phony news to influence asset values isn’t exclusive to crypto.
Nonetheless, today’s events serve as a caution to be especially cautious while dealing in the emerging cryptocurrency industry. While Litecoin and bitcoin are well-known, there is a slew of other currencies and tokens that aren’t.
Many unethical entities are seeking to profit from investors’ enthusiasm for cryptocurrencies.