- Recently, a South African exchange had $3.6 billion in Bitcoin disappear — alongside its owners.
- It is not yet clear whether the money disappeared in a hack or if it was all a massive exit scam.
- The incident happened in April when the exchange announced that it was hacked and stopped responding after the announcement.
Cryptocurrency scams and hacks are a well-known occurrence in the crypto industry, which is why so many governments and institutions still hesitate to join and adopt crypto. Scams were more frequent in 2016, 2017, and 2018, when the ICO trend was still strong. Since the IEO trend has taken over, however, the number of scammy projects has seen a reduction.
However, it is still possible to run into a scammy exchange, broker or to have cryptos stolen in a hack. But, sometimes when the coins go missing, it is not immediately clear which of these actually happened. One example is the recent disappearance of $3.6 billion in Bitcoin, which vanished from the South African crypto platform, AfriCrypt. Not only that, but the platform’s operators appear to be nowhere to be found.
According to recent reports, around 69,000 Bitcoin disappeared from the exchange, alongside the firm’s owners — brothers Ameer and Raees Cajee. So far, it remains a mystery what happened, as no one seems to have the facts about whether this is a hack or an exit scam.
If it is an exit scam, it will be the biggest one in crypto history. According to what is known, it wouldn’t be surprising if it was indeed a scam by the brothers. After all, the platform reportedly promised that investors could get 10% returns on their investments per day, which is, of course, far too good to be true, and a red flag indicator of scammy behavior to attract people looking to make quick money.
The exchange seems to have done everything in its power to attract as many high net worth investors as possible, after which it urged them to invite friends and others who want high returns on their investments. However, many may say that claiming that it is possible to make 10% of each investment every day is a clear warning sign.
The exchange itself has been around for about two years now, after being launched in 2019. It allegedly managed to amass some $3.6 billion in BTC or around 54 billion rands. However, on April 13, 2021, the exchange sent a message to its investors claiming that it was hacked. It claimed that it is on the case, trying to retrieve compromised information and the funds that the alleged hackers had stolen.
Exchange’s notice awoke suspicion
The affected users turned to a local law firm called Hanekom Attorneys; the law firm found it suspicious that the platform informed users that they are free to take legal action but if they did that would slow the platform down in its efforts to retrieve the money. In other words, the platform wanted its users to sit and wait instead of taking the legal route, which the law firm found suspicious.
The law firm further said that the brothers seem to have transferred 69,000 Bitcoins from the exchange’s accounts, as well as clients’ wallets. The funds were then allegedly sent to various crypto mixers and tumblers on the dark web in order to make them untraceable.
Since the announcement, nobody has been able to get in direct contact with the brothers. All calls went to voicemail, and the exchange’s website has been down ever since. Soon enough, the law firm turned to the national police and their elite unit, Hawks. The matter was also taken to the country’s Gauteng South High Court, which granted provisional liquidation orders against the owners. Their deadline to respond is July 19th of this year.