Litecoin, the ever popular altcoin that frequently boasts fast transaction times and low fees is about to get its own payment provider. The of the soon to be payment provider is Litepay.
It may even get its own set of linked payment cards that would allow users to directly spend Litecoin at any retail outlet that accepts that type of payment card. The service is supposedly going to launch in February of this year.
Will people want to use it, and will it improve the visibility and usage of Litecoin as a whole?
Bitpay for Litecoin?
In recent years, we've seen a number of payment processing providers offer support for various cryptocurrencies, most commonly bitcoin. While the individual transaction fees of bitcoin have been dropping this week, Litecoin still offers a more affordable alternative. Litecoin transactions still remain at just a few cents each or less, while bitcoin fees on a good day are just under a dollar.
You may be asking, what is a payment provider?
Basically speaking, this is equivalent to a company that helps retail outlets process credit card transactions. A payment processor for cryptocurrency means that it is a company that will help retailers accept payment cards or other payment methods of cryptocurrency (such as from a mobile wallet that scans a QR code) and then immediately or quickly deposited in their account an equivalent amount of the local fiat currency.
While some store owners may be on the forefront of cryptocurrency and be willing to accept it directly as payment, unfortunately, many businesses have strict tax laws or oversights that force them to deal exclusively in fiat currency. Some countries even directly outlaw businesses from accepting cryptocurrency such as China.
Further, many credit card companies often charge quite a high fee to retailers in order to process their credit card transactions. According to the Litepay official website, credit card fees are often 3% or more.
To make things worse, credit cards are more likely to suffer from fraud through problems such as chargebacks.
Litepay aims to offer a solution to both of these issues, while at the same time allowing its customers to use Litecoin for payments. The company claims that it will charge a flat 1% rate for all transactions and that since the funds are cryptocurrency backed, they will not be subject to chargebacks and fraud the same way that traditional credit cards are.
Get paid in Litecoin with Litepay
While details are not available yet, Litepay also claims that if a customer chooses, they could even have their salary each pay period directly deposited into their Litepay account. From there, it would then presumably be automatically converted into Litecoin. This is still unclear, however.
We also do not yet know if Litepay will offer its own cryptocurrency exchange services such as allowing people to purchase Litecoin directly. We also do not know if Litepay will eventually support other cryptocurrencies or not.
It's quite likely that they will, based only on the fact that limiting themselves to just one currency could prove to be a lost source of income.
While Litepay is not directly connected to the Litecoin foundation, or Litecoin founder Charlie Lee, they have received at least some indirect support from them both on twitter. Both the Litecoin foundation and Charlie Lee follow the Litepay twitter account.
