Where are the missing bitcoin billions?

Did you hear about the two South African brothers who ran away with over R50 billion worth of bitcoin? No, it’s not the start of a really complicated joke.

Quick explainer: Bitcoin is a digital form of money that isn’t controlled by any central bank or government. You can’t physically hold it, but it has real value and can be used to buy things or cash in as normal money.  Thanks to its unique blockchain technology, all transactions are recorded publicly but it’s pretty anonymous: nobody would know which ‘account number’ was yours unless you told them.

Enter the Cajee brothers, who saw an opportunity. They ran a cryptocurrency investment platform called Africrypt from SA, trading bitcoin on behalf of investors. They seemed to have rather high rates of returns and regulators now suspect it was a Ponzi scheme. In April they told their investors that the platform had been hacked – then promptly vanished. Even their former lawyers say their services have been terminated.

Former clients said the two, young as they were, talked a good game. Another client told Moneyweb the Cajees were prominent members of Johannesburg’s Muslim community and exploited the trust of friends and family.

But how did the pair get people to invest FIFTY BILLION rands worth of bitcoin? Well, lawyer Darren Hanekom, acting on behalf of several clients, believes the Cajees were acting on behalf of a much bigger international syndicate.

“It is very unlikely that they managed to rope in more than R50 billion from investors,” says Hanekom. “This was a money laundering operation.”

Remember folks, if it’s too good to be true, it probably isn’t. 😕

This article appeared as part of The Wrap, 01 July 2021. Sign up to receive our weekly updates.