Why it matters: Litecoin values spiked by more than 34 percent for a brief period Monday morning after a bogus press release claimed Walmart would begin accepting the cryptocurrency. The whole fiasco, which lasted less than an hour, demonstrates the incredible influence that a major company can have on the crypto market.
The press release was shared on GlobeNewswire, a PR distribution platform used by many companies. The problem, however, is that Walmart normally uses Business Wire to help distribute its press releases to media outlets. What’s more, the GlobeNewswire piece linked to a non-functioning website and as The Verge further highlights, there was no associated Securities and Exchange Commission filling which one would expect considering Walmart is a publicly traded company.
Walmart never posted the news release on its corporate website.
Nevertheless, several news outlets published stories based on the fake press release, and Litecoin’s value went from around $175 to more than $236 in just 15 minutes.
It didn’t take long for people to catch on to the hoax. Less than 40 minutes after reaching the $233 mark, Litecoin was back down to around $178.
It’s unclear who was responsible for the bogus press release. A spokesperson for Walmart confirmed to CNBC that the release was not authentic, adding that they have reached out to the PR firm to investigate how the post made it out.
It doesn’t take a rocket scientist to determine a plausible motive behind the fake press release: short-term financial gain. By swinging the market so suddenly, whoever was behind it likely sold off their holdings at the peak and walked away with a sizable profit.