Litecoin Foundation, the nonprofit associated with Litecoin, has acquired 9.9% of Germany’s WEG bank, opening the door for the cryptocurrency to become a part of mainstream banking. The stake in the German bank was originally acquired by TokenPay Swiss AG, a crypto-to-fiat payments startup. TokenPay passed it on as part of an agreement with the Litecoin Foundation. Per the agreement, Litecoin Foundation will offer “broad and comprehensive” marketing and technology services to the startup. TokenPay has options to purchase the remaining 90% stake and plans to exercise them soon. (See also: Litecoin And Litecoin Cash: What's The Difference?)
A press release for the announcement identified “blockchain mechanization capabilities” as Litecoin Foundation’s specific expertise and identified key areas of partnership, such as debit cards and decentralized exchanges, between TokenPay and the foundation.
Charlie Lee, Managing Director of Litecoin Foundation, said the partnership was a “win-win” for both parties and could help TokenPay get onto the Lightning Network - a layer two solution. “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,” said Matthias von Hauff, founder and CEO of WEG Bank.
In a separate interview, Lee said that the decision to acquire a stake in the German bank was driven by problems faced by the foundation due to its dealings with mainstream banks. “We figured why not take a stake in a bank and work from inside,” he said. According to him, the acquisition could pave the way for mainstream crypto products such as debit cards and attract customers interested in having fiat and crypto accounts in the same financial institution.
As of this writing, Litecoin is the sixth-most valuable cryptocurrency in the markets and has a market capitalization of $4.4 billion. The cryptocurrency skyrocketed by 5088% last year but it has shed more than $10 billion of its value since March. (See also: Litecoin's Phenomenal Year).
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