South African crypto platform denies claims of stolen billions

south african crypto africrypt

Co-founder of AfriCrypt, a South African-based cryptocurrency investment firm, Raees Cajee has rejected the claims that investor funds were stolen – stating that AfriCrypt lost $5 million USD worth of cryptocurrency in a hack.

AfriCrypt denies claims of stolen billions

Earlier this year, AfriCrypt had sent a notice to users of the platform regarding the hack – urging investors to avoid taking legal action in order to ensure the recovery process wouldn’t be slowed down. That, standing as a red flag, coupled with the fact that the brothers had allegedly halted the platform’s operations and then shortly thereafter disappeared raised warning signs to investors and the public. Three months later, Raees spoke with The Wall Street Journal to counter the claims against himself, his brother, and the platform noting that their disappearance was rather that they had gone into hiding after receiving death threats.

According to The Wall Street Journal, investors had hired lawyers, alleging that as much as $3.6 billion USD may be missing. However, Raees noted that the firm’s portfolio was never that significant, saying:

At the height of the market, we were managing just over $200 million.” He also added that no more than $5 million USD had been displaced.

FSCA notes the firm has Ponzi-like characteristics

Despite the denied claims from the co-founder, the South African Financial Sector Conduct Authority (FSCA) stated that the firm showed more signs of something less legitimate and had several indicators that the platform might be a Ponzi scheme. According to the FSCA:

This entity was offering exceptionally high and unrealistic returns akin to those offered by unlawful investment schemes commonly known as Ponzi’s.” 

While the FSCA made comments, it also noted that it could not take any legal action against AfriCrypt because the regulations in South Africa are not yet founded enough to make a case against the platform.

Related Articles

Block’s Bitcoin Division with 90% Boost in Gross Profits

Block announced that in Q4 2023, Cash App generated $66 million in Bitcoin gross profit up 90% year-over-year.

Citrea Secures $2.7M Seed Funding for Bitcoin ZK-rollup

Citrea secured initial funding to bring the solution to market, which could allow for NFTs and blockchain games on Bitcoin.

Binance Adopts USDT Price Cap to Align with Rules in Nigeria

The price cap of 1,802 Naira per USDT in Nigeria blocks accounts of traders on Binance attempting to sell above it.

Australia’s BTC Enthusiasm Surges Over Spot Bitcoin ETF

Australian retail interest in Bitcoin increased by 100%, the rise in positive sentiment was skewed heavily by those aged 55 and above.

See All