Litecoin creator and Managing Director of the Litecoin Foundation Charlie Lee announced onTwitter Tuesday that theLitecoin Foundation has acquired a9.9% stake in the German financial institution WEG Bank AG. The equity was received fromTokenPay, a strategic partner of the Litecoin Foundation, who transferred their shares in exchange for technical assistance with various blockchain projects from the Litecoin Foundation.
Specifically, TokenPay hopes to benefit from the Litecoin Foundation’s “high-level blockchain mechanization capabilities,” particularly in the development of a TokenPay cryptocurrency (TPAY) and its underlying blockchain, and the launch of a decentralized exchange (eFin) with its own native token.
After transferring their initial equity stake to the Litecoin Foundation, TokenPay purchased another 9.9% equity in WEG Bank. Under German banking law, no single entity can own more than 9.9% of a bank without regulatory approval. TokenPay has sought approval to purchase a controlling stake (90%) in WEG Bank. Once approval from regulators is received, TokenPay will exercise its option to buy the remaining shares necessary to control 90% of the financial institution.
Charlie Leesaid, “This partnership is a huge win-win for both Litecoin and TokenPay. I’m looking forward to integrating Litecoin with the WEG Bank AG and all the various services it has to offer, to make it simple for anyone to buy and use Litecoin. I’m also excited about Litecoin’s support in TokenPay’s eFin decentralized exchange.”
Matthais von Hauff, the Founder and CEO of WEG Bank said, “The partnership with innovative institutions such as TokenPay and Litecoin might at first come unexpectedly for a very conservative institution like us. But we have thoroughly and diligently examined the prospects of a common future, and we became convinced that the future of banking will make adoption of such modern payment methods inevitable. We are therefore proud to have teamed up with the best in the field.”
Dr. Jorg E. Wilhelm, Head of the Supervisory Board of TokenPay, said, “We are elated to be in the process of acquiring a large stake in a successful business bank based in Germany such as WEG. Our ecosystem…provides us with a tremendous opportunity regarding merchant solutions, along with a strong and diverse customer base for our crypto debit card business. The tangible reality of bridging the gap between the old and new world is electrifying.”
In addition to the partnership with the Litecoin Foundation, TokenPay has also partnered with Verge (XVG) and plans on releasing aVerge debit card in the near future.
In aninterview with Cheddar, Charlie Lee stated that the decision to obtain equity in WEG Bank was made after the Litecoin Foundation had trouble opening a bank account. Indeed, traditional financial institutions have been wary of banking cryptocurrency organizations due to the regulatory uncertainty that surrounds the industry.
Lee hopes that by obtaining equity in WEB Bank, the Litecoin Foundation will be able to make the financial services industry more crypto-friendly from the inside out.
About the author
Cameron Carpenter is a student of economics and computer science at Sarah Lawrence College in Bronxville, New York. He is the President and Portfolio Manager of Gryphon Capital Management, a student-run investment firm. In his spare time, Cameron enjoys reading and playing chess.