Investor Protection Gaps in Cryptocurrency... Walmart Allows Litecoin Payments Sparks Fake News Controversy

Fake News on Litecoin Payment Emerges via Press Release Distribution Service
Major Media Reports Cause 30% Surge
Sharp Drop After Walmart Fake News Mention
SEC Chairman: "Cryptocurrency Investor Protection Only at Pre-Securities Law Enforcement Level"

[Image source=AP Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] The cryptocurrency market was significantly shaken by fake news. The news that Walmart, the largest offline store in the United States, would allow payments with the cryptocurrency Litecoin undermined the credibility of cryptocurrencies.

According to CoinMarketCap, Litecoin was trading at $175 around 8 a.m. on the 13th (local time), then surged 30% to $231 by around 9:50 a.m.

However, as of 3:20 p.m., it was trading around $180, down 2.5% compared to 24 hours earlier.

The sharp rise in Litecoin that day was triggered by a press release reporting that Walmart had partnered with Litecoin to provide cryptocurrency payment services.

Major U.S. media outlets urgently reported, based on the materials, that Walmart CEO Doug McMillon announced the implementation of Litecoin payment options starting October 1.

Since Walmart, a leading U.S. retailer, entering cryptocurrency payments was news that could shake the market.

However, Walmart stated in a press release, "The press release about allowing Litecoin payments is not genuine." Walmart also added that it is investigating Globe Newswire, which distributed the press release, and the circumstances of the false press release dissemination.

After Walmart's announcement, Litecoin's price returned to its previous level, but calls for stronger cryptocurrency regulations are expected to grow.

Gary Gensler, chairman of the U.S. Securities and Exchange Commission (SEC), who advocates for stronger cryptocurrency regulations, urged cryptocurrency-related regulations in a written statement submitted ahead of his scheduled appearance before the Senate Banking Committee the next day, saying, "Right now, we are not providing sufficient investor protection regarding cryptocurrency finance, issuance, trading, and lending. Frankly, it is like the Wild West era or a time before securities laws were enforced, where buyers bear the risks."

The media outlets that reported the fake news also became targets of criticism. Yahoo Finance reported that some investors strongly complained that major media outlets reported fake news based on the press release without verification.

The cryptocurrency specialized media Decrypt also reported that the Litecoin Foundation retweeted the fake news.

This content was produced with the assistance of AI translation services.