Cryptocurrency Litecoin saw a sudden surge in price on Monday over a press release about Walmart accepting it for payment – which turned out to be fake.
According to the release, which was distributed via a legitimate press channel, Walmart would accept the currency in all of its digital stores.
Walmart later told US media outlets that the announcement was “false.”
By that point, the alleged news had been disseminated by several major news websites and press agencies.
It’s unclear how the announcement ended up on Global Newswire, a service that’s widely used to distribute press releases from businesses.
The phoney press release has since been removed, and it did not appear on Walmart’s website.
A tweet from a verified Litecoin Twitter account promoting the release was also removed. Hours later, the Litecoin Foundation tweeted that no such collaboration existed.
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However, while this was being reported as fact, the price of Litecoin rose from around £125 per token to close to £170 before falling back to around £128.
It’s unclear who was behind the fake release or how they got it published.
However, so-called “pump and dump” schemes are common in the cryptocurrency world, in which bad actors attempt to inflate the price of a coin by creating hype around it, then quickly sell off their own stock before the market corrects itself.
The erroneous press release claimed that Litecoin would be accepted on all Walmart ecommerce platforms beginning October 1.
It contained quotes that appeared to be from both the CEO of Walmart and the founder of Litecoin.
One indication of its nature was that a press contact email address pointed to a web domain that had only been registered a month before. Emails sent to that address were returned as undeliverable.
When CNBC called Walmart representatives, they were told the press release was a forgery. CNBC stated that it was one of the news organisations that published the storey before realising it was false.
We reached out to Walmart, the Litecoin Foundation, and Global Newswire for comment.
The announcement piqued the interest of some sceptics due to the volatility of cryptocurrency prices, which can be an impediment to using them for retail purchases.
Other businesses that have accepted Bitcoin have negotiated terms that limit their exposure to large price swings.
When Tesla briefly accepted Bitcoin as a payment option for its cars, it made it clear that the price was in US dollars – and that any quote in equivalent Bitcoin was only valid for a limited time.
It also stated that if a refund was required, Tesla would have the option of paying it back in US dollars or Bitcoin, which may have a lower cash value than what was paid.
Similarly, PayPal recently added the ability to buy and sell Bitcoin, but it cannot be used to make payments. Instead, the cryptocurrency assets will be sold for the appropriate amount of real money to complete the transaction.