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
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.
Last modified (UTC): March 17, 2017 8:56 AM