PayCoin Delisted from ShapeShift.io amid Fraud Concerns

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ShapeShift
Instant altcoin exchange ShapeShift.io chose to remove PayCoin from their platform.

Today, altcoin exchange ShapeShift.io formally removed PayCoin (XPY), GAW CEO Josh Garza’s controversial altcoin, from their list of accepted coins. Citing PayCoin’s (alleged) broken promise to buy PayCoins at $20 each, ShapeShift considers PayCoin a fraud.

Also read: Coin-Swap Retires Some Altcoins

PayCoin Delisted from ShapeShift.io

ShapeShift made the announcement in a Reddit post. They explain that they originally added the coin due to customer demand but decided to remove it after allegations that PayCoin is a scam prompted ShapeShift.io to conduct a closer investigation.

We’ve looked further into Paycoin, and while there are some criticisms that are superfluous (a coin being “premined” does not necessarily make it a scam, for example), there is one particular issue that we cannot ignore. Josh Garza and the Paycoin admins made a very clear promise – a guarantee – which is that when Paybase opened (a Paycoin marketplace), that Paycoins would be bought there for $20 each. That was a factual promise, made by the creator of the coin.

However, Garza–at least in ShapeShift’s eyes–did not live up to his self-imposed obligation:

And yet here’s what happened: not only did Garza not fulfill his promise to back the value of Paycoin at $20 per coin, but himself and his administrators seem to be actively re-writing history, scrubbing their forum of any mention of that promise. This moves it from fool’s errand to the realm of deception.

The coin now sits around $5, and Garza is claiming he never promised $20. We believe this satisfies a high threshold of evidence as fraud, and so we have decided to remove Paycoin from www.ShapeShift.io.

It is unclear what affect ShapeShift’s delisting of PayCoin will have on the altcoin–other than adding fuel to its critics’ fires. At present, Cryptsy and Bittrex process most PayCoin trades. However, PayCoin has a guaranteed exchange presence even if other exchanges follow ShapeShift’s lead and remove the coin from their platforms. Josh Garza recently acquired Coin-Swap, and it is unlikely that public pressure could dissuade him from listing his own coin at Coin-Swap.

Images from ShapeShift.io and Shutterstock.

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Josiah is an assistant editor at CCN. A former ancient and medieval literature teacher, he has been reporting on cryptocurrency since 2014. He lives in rural North Carolina with his wife and children. He holds investment positions in bitcoin and other large-cap cryptocurrencies. Follow him on Twitter @Y3llowb1ackbird or email him directly at josiah.wilmoth(at)ccn.com.