Andrew Vegetabile, director of the Litecoin Association and CEO of the forthcoming Koinyx exchange, released a statement Wednesday attacking GAW, Paycoin, and founder Josh Garza. He describes Garza as
Andrew Vegetabile, director of the Litecoin Association and CEO of the forthcoming Koinyx exchange, released a statement Wednesday attacking GAW, Paycoin, and founder Josh Garza. He describes Garza as someone with sociopathic traits and reminds Garza that a live debate offer remains open.
The statement represents Vegetabile's personal views. The Litecoin Association did not endorse, vet, or know about the message beforehand.
The conflict traces to January, when Vegetabile demanded that Coin-Swap remove Litecoin from its exchange. Garza had purchased Coin-Swap and added Paycoin to the platform. Vegetabile saw a clear conflict of interest, and other developers in the crypto community agreed, joining a boycott.
Garza responded by challenging Vegetabile to a public debate. Vegetabile accepted. Garza then proposed a shift: written exchanges instead of the live, online debate he first demanded. The debate never took place. The planned Q&A with Garza at the North American Bitcoin Conference in Miami never happened either.
In the months since, revelations piled up. The SEC launched an investigation. Power companies filed lawsuits over unpaid bills. Staff members raised concerns about operations. Paycoin's price collapsed.
Paycoin trades at $0.20, down from Garza's guarantee that the coin would never fall below $20.
Vegetabile began raising concerns about the arrangement when Garza purchased Coin-Swap. He saw buying an exchange while running a cryptocurrency as an ethical problem. The owner could control both the coin and the platform to dump it. "For those unaware, GAW bought an exchange and I felt it was irresponsible to have an exchange along with a crypto coin because it presented an ethical boundary that should not have been crossed where one could have the potential of owning a coin and having the means to dump it," Vegetabile explained.
In his statement, Vegetabile catalogs what followed. "The level of at the best mismanagement and at its worse potential scamming and illegal activities has reached beyond which I can once again sit back and stay idle," he wrote.
Garza pledged a $20 price floor, profitable mining operations, partnerships with retailers including Walmart and Target, and a Paybase platform. None materialized. The core wallet shipped incomplete, with minimal updates after launch. Users had no choice but to store coins on exchanges, exposing them to hacking and frozen withdrawals.
Vegetabile foresaw trouble from the start. He had warned months earlier that GAW's actions could trigger failures reaching far beyond the crypto sector. "I foresaw something like this akin to leading up to a massive failure beyond cryptos, which now bleed into standard news sites and once again giving cryptos a black eye," he wrote.
Beyond operational failures came allegations of serious crimes. Participants in a Bitcointalk thread spanning over 1600 pages exposed claims of securities fraud, money laundering, extortion, grand theft, insider trading, retaliation against whistleblowers, wire fraud, and charity fraud. The SEC investigation is confirmed, and FinCen, the IRS, and the DHS may also investigate.
The damage extends beyond GAW itself. Vegetabile argues that the fallout undermines the entire cryptocurrency community. "The fallout from all of this will be damaging to the entire crypto eco system and set back efforts from thousands of collective volunteers across all the communities that work tirelessly to promote cryptos in order to gain mass adoption," he wrote.
In Vegetabile's view, Garza shares the blame with Mark Karpeles and Ryan Kennedy for damaging crypto. "What Mr Garza has done was give a metaphorical middle finger to everyone in cryptos," he wrote, "and has earned him a place alongside Mark Karpeles and Ryan Kennedy in my eyes."
For Paycoin to recover, Vegetabile argues, the community must fork the code, remove the controllers, and burn their coins. Developers must fix critical wallet bugs so users can store coins offline. The community must demand transparency from leaders and verify claims made. The community must also separate from GAW.
"In order for the communities to heal from this entire debacle, the code must be forked," Vegetabile stated. "In my personal opinion, all prime controllers need to be removed and the coins contained within them need to be sent to a burning address."
Vegetabile adds that he supports helping the Paycoin community recover, despite the scandal surrounding the coin's creation. The community members themselves are not responsible for GAW's actions. "While the circumstances under which Paycoin was created along with GAW are trash, the community isn't. They are already a part of the crypto eco-system whether people like it or not. In order for all of us who really wish to see cryptos grow, we should be helping those in these types of situations. That is my intentions behind this," he wrote.
Vegetabile directs his final words at Garza. "On my short time here on earth I have met many people with sociopathic traits, and you fit the bill. I really have nothing else to say beyond this, and the way you have used people like toilet paper is deplorable. And just as a FYI I'm still up for the live debate you decided to run away from."
