Cryptocurrency investors of South African exchange AfriCrypt have reportedly lost $3.6 billion in Bitcoin after what was first reported to be a hack. However, along with the funds, the two founders of the crypto firm, who also happens to brothers, have vanished and there is no trace of them yet.
This is another major incident after last year’s fall of another South African Bitcoin trader, called Mirror Trading International. The platform had suffered losses of 23,000 digital coins, that summed up to approximately a whopping $1.2 billion. Hence, it went on to become the largest hack of 2020. If the funds are not recovered, the Africrypt investors are at a risk of losing three times as much.
Biggest Bitcoin Hack?
It all started in April this year when Bitcoin was rallying to record-breaking numbers. Hence, the disappearance of nearly 69,000 Bitcoin could be essentially turn out to be the biggest-ever dollar loss in a cryptocurrency hiest.
Africrypt Chief Operating Officer and the elder brother Ameer Cajee notified clients that the firm suffered a hack. However, he advised them to not report the incident to lawyers and authorities, as it could impede the recovery process of the missing funds. This message was sent on the 13th of April at a time when the crypto exchange raked in around $3.6 billion in Bitcoin.
However, not all of the investors compiled with this request. Some of the ones involved with the exchange also went on to onboard a law firm, Hanekom Attorneys. Additionally, a few also initiated the liquidation proceedings against Africrypt. After the Cape Town-based law firm failed to trace the two brothers, they alerted the South African police force, Hawks. Furthermore, it notified other cryptocurrency exchanges across the world if the brothers attempted to convert the coins to fiat.
However, the investigations also revealed that Africrypt’s pooled funds were moved from its South African accounts and client wallets. To top that, the digital coins were put through tumblers and mixers to essentially make them untraceable. The law firm was quoted saying,
“Africrypt employees lost access to the back-end platforms seven days before the alleged hack”