Africrypt Cryptocurrency Scam: FSCA Considering Cryptocurrency Regulation
Login

Africrypt Cryptocurrency Scam: FSCA Considering Cryptocurrency Regulation

Estimated Reading Time: 3 minutes
Article Rating:
Based on 1 vote
Login to rate this article.

Azeez Mustapha

Updated:

Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong. Take 2 minutes to learn more


Following the Africrypt scandal, South Africa’s Financial Sector Conduct Authority (FSCA) has released a statement yesterday noting that it lacked regulatory jurisdiction over cryptocurrencies. The regulator also warned the public about the “high-risk nature of investing in crypto assets.”

In addition to its worries over the “suitability of crypto assets as an asset class” and their volatility, the FSCA also expressed worry over the “the large number of scams being perpetrated by persons purporting to provide the crypto asset to the public.”

The regulatory agency asserted that many cryptocurrency investment companies carry out fraudulent operations. The FSCA noted that:

“Many of these entities (which we refer to as intermediaries) are often not based in South Africa or have poor security in place to protect the crypto asset being acquired by the public, and in theory, held on behalf of the customer. Often, however, these intermediaries are just fraudulent operators.”

While the agency acknowledged that the crypto space in South Africa contained “[several] legitimate players offering a legitimate service,” it urged investors to exercise caution given the “very large number of unscrupulous players in this sector.”

Africrypt Scam Imitates MTI’s

In its statement, the FSCA asserted that it would “continue to update the public as more information becomes available regarding Africrypt.” The statement also advised investors to “always check that an entity or individual is registered with the FSCA to provide Financial Advisory & Intermediary Services.” The regulatory agency is currently considering declaring crypto assets as financial products.

The Africrypt scam followed a similar process to the Mirror Trading International (MTI), which ranked as the most significant Bitcoin scam of 2020. Like MTI, Africrypt collapsed after its executives fled with investors’ funds. The collapse came after a breach and subsequent freeze in withdrawals in April.

At the time, Africrypt directors Ameer Cajee and his brother Raees Cajee alerted investors that the breach had compromised “client accounts, wallets, and nodes.” The directors also warned their clients against involving legal bodies as that “will only delay the recovery process.”

Reports claim that the brothers fled to the UK since the company collapsed.

 

You can purchase crypto coins here: Buy Tokens

  • Broker
  • Benefits
  • Min Deposit
  • Score
  • Visit Broker
  • Award-winning Cryptocurrency trading platform
  • $100 minimum deposit,
  • FCA & Cysec regulated
$100 Min Deposit
9.8
  • 20% welcome bonus of upto $10,000
  • Minimum deposit $100
  • Verify your account before the bonus is credited
$100 Min Deposit
9
  • Over 100 different financial products
  • Invest from as little as $10
  • Same-day withdrawal is possible
$250 Min Deposit
9.8
  • The Lowest Trading Costs
  • 50% Welcome Bonus
  • Award-winning 24 Hour Support
$50 Min Deposit
9
  • Fund Moneta Markets account with a minimum of $250
  • Opt in using the form to claim your 50% deposit bonus
$250 Min Deposit
9

Learn to Trade

Never Miss A Trade Again

step 1
Signal Notification

Real-time signal notifications whenever a signal is opened, closes or Updated

step 2
Get Alerts

Immediate alerts to your email and mobile phone.

step 3
Entry Price Levels

Entry price level for every signal Just choose one of our Top Brokers in the list above to get all this free.

Share with other traders!

telegram
Telegram
forex
Forex
crypto
Crypto
algo
Algo
news
News