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In light of the recent Africrypt saga, the South African Financial Sector Conduct Authority (FSCA) has stated that it is in the process of considering declaring crypto assets as a financial product, giving the regulator jurisdiction over crypto transactions.

Within the space of one year, South Africa has produced not one, but two, massive crypto scams, resulting in millions of Rands disappearing into thin air. The first being Mirror Trading International (MTI), which was labeled as 2020’s biggest scam by blockchain analysis company, Chainalysis. As a result of the MTI scam, investors are said to have lost nearly R9 billion. 

The latest crypto scam, making global headlines, was run by a company formed in 2019 called Africrypt. Africrypt was created by South African brothers, Ameer and Raees Cajee, who have since disappeared. 

Africrypt reportedly had several high profile South Africans among its investors. The company claimed to have been hacked on or around April 13 2021, with an alleged R54 billion swiped out of multiple wallets controlled by directors of the company in a matter of hours.

Global Crypto has conducted extensive research, but is unable to confirm if the alleged figure of R54 billion is accurate. If accurate, this could potentially make Africrypt the biggest cryptocurrency heist in history.

Commenting on the Africrypt situation, in a recent press release, the FSCA said:

“To protect the public, the authority is in the process of considering declaring crypto assets as a financial product, which would give the FSCA jurisdiction over these transactions.”

As it stands, the FSCA is completely powerless with regards to crypto transactions. The regulator said that they have discovered evidence of crypto asset transactions, but they are unable to act on them because crypto assets are currently not regulated in South Africa.

Feature image by Block Inspect from flickr

Andrew is a law student currently studying at UNISA, and Global Crypto's in-house reporter. Andrew discovered blockchain in his final year of school and since developed a keen interest in the subject. He appreciates a good cup of coffee. When he is not too busy with work or studies, he enjoys playing a good round of golf.