I wonder if in the history of banking the first banks had this much fraud with normal currency? Or is this just specific to Bitcoin? It feels like the stats now are just where by default everything with Bitcoin is (eventually) fraudulent and honest services are the exception.
There's a reason why the middle ages had a huge number of coins. A mint could be trustworthy for a generation as some Noble family takes care of it with high degrees of trust. (Usually proven amounts of silver in each coin, for example)
Then the wrong child becomes the leader of the family and and bam, they start reducing the silver weight and replacing the coins with cheaper metals and the entire trust in that coin disappears.
And that ignores issues like the Conquistadors coming back from the new world with literally tons of gold / silver and royally messing up the gold / silver coinage economy.
It wasn't fiat money, they were deposit notes representing gold or silver. And while outright fraud wasn't much of an issue since physical banks can't just disappear and leave town overnight, if the bank collapsed the currency would probably not be redeemable anymore.
I mean a currency that protects you from government intervention also protects criminals from law enforcement. They're just two sides of the same coin.
The first banks would have dealt mostly with physical money / gold, so it would be a lot harder to pull off this kind of fraud.
I’d like to know this as well. I suspect there’s more because now the entire contents of the vault can fit onto a slip of paper. So just logistically can be moved around more than previous bank eras.
you don't need to go that far back in time to find banking issues basically in every major geography, with different kinds of currencies, digital or not.
This still happened as recently as 100 years ago. Con men would set up false banks in small towns and make off with a lotnof money. Lookup Yellow Kid Weil.
I think hard currencies took care of trust about intrinsic value. It's only the establishment of rule-of-law and regulations allowed fiat currencies to proliferate. Regulations were written in the tears, fears, and anger of common folk. There's essentially no way to trust someone else with a BTC wallet and there's no trust in BTC's value because there's nothing behind it... it shouldn't be used to store value long-term, only for quick, transactional events.
Banks and municipalities who issued their own fiat currencies I believe encountered many more problems.
> Nothing is known about Diogenes' early life except that his father, Hicesias, was a banker.
> Hicesias and Diogenes became involved in a scandal involving the adulteration or debasement of the currency,[10] and Diogenes was exiled from the city and lost his citizenship and all his material possessions.
Deposit insurance is a relatively new concept, at least in North America. It didn't exist in the US until the Great Depression. Canada did not introduce it until 1967.
A lot of what's happening in the crypto space is just self-professed libertarians re-discovering fire. They start off by being skeptical of banks and monetary authorities, but eventually realize that an unregulated free-for-all attracts bad actors that ruin it for everyone else. Hence the wet blanket of AML + KYC + Deposit ratios.
Even in the modern era there's a lot of fraud and scamming going on. This sounds like a classic Ponzi scheme, and Bitcoin-based Ponzis are just one corner of a broader universe of similar scams all across the globe. They've even brought down governments and the odd country...
What if the exit scams happening today in China are 10x worse than South Africa’s, because it’s so much bigger, but we aren’t hearing about them? Never mind history.
Its just as large and just as consequence free as bitcoin/crypto heists and fraud despite the paper trail
Some reinforce their respect of one system by looking at the proportions of the money supply and transactions, I would say that isnt that important as the industry / interest in fraud has a fixed size
Every time that I read a story like this I am always wondering: how come the people doing exit scams (suppose it is one) aren't more afraid of the repercussions.
Given Bitcoins track record, it wouldn't surprise me if some of the funds would belong to quite questionable characters, so you are basically stealing money from organized crime groups.
It is obvious that you can buy some protection with $3.6B, however your face and name is publicly known, meaning that you will be on the run for the rest of your life or possibly face a very gruesome death.
The simple answer is that they can affect the change that they are interested in, with that money now. Instead of imagining for their whole lives.
Basically, life isnt worth living poor, or the current state of the world isnt worth being unable to change. Death is more favorable than skimming table scraps.
Although the luxury consumptive spending is a tiny portion of what is possible, and nobody can take those experiences away from you, the funds contributed to charities, political campaigns, and investments allow shaping the world as you see fit now.
So thats the explanation, without justifying it. Despite recent attempts of making society seem more fair, this has always been the history of the world. Seize and lock in a millennium of control and favor for your family.
You are correct and gruesome deaths happen, like with OneCoin. The ponzi queen, however, is gone and “no one” know if she is dead or managed to disappear alive.
That's overblown. Going into hiding is easy with a pile of money by your side. Just cross into a country with a different language, change your appearance by changing your body fat % or growing hair, then buy yourself some new ID documents. That's literally 1 or 2 years of work and you are now successfully hiding in plain sight. Most people would take that trade off
The first signs of trouble came in April, as Bitcoin was rocketing to a record. Africrypt Chief Operating Officer Ameer Cajee, the elder brother, informed clients that the company was the victim of a hack. He asked them not to report the incident to lawyers and authorities, as it would slow down the recovery process of the missing funds.
and
While South Africa’s Finance Sector Conduct Authority is also looking into Africrypt, it is currently prohibited from launching a formal investigation because crypto assets are not legally considered financial products, according to the regulator’s head of enforcement, Brandon Topham. The police have not yet responded to a request for comment.
$3.6B is 1% of South Africa's GDP. That's a lot of money.
With a population of approximately 60 million people that's an average of R850 (approx. $60) per person in SA at the current exchange rate. Obviously only a small fraction of the population are going to have invested. Even if I guess an improbably high number of 1 million investors the losses are R51000 per person (around $3600). That's more than a month's salary even for those just inside the top 1%, since it only takes $3500 per month to be in the top 1% of earners in SA [1].
South African here, I’m also wondering how they acquired so much Bitcoin.
The figure is slightly inflated as it’s the value at Bitcoin’s high earlier this year, but it’s still a lot.
My theory is lots of international customers as I don’t see our market being big enough, thumb sucking, but I reckon 2/3 of our country earns less than 500USD a month. Maybe their customers are from other African countries, but it feels unlikely to be enough.
Perhaps they had some “whale” clientele from several different countries.
I wouldn’t personally think the “Afri” in their name is particularly meaningful, it’s just a naming thing, but maybe some people treat it differently.
It’s questionable whether all of it is South African money. Not sure whether this pay walled article mentions it but there is suspicion of it being a money laundering op. The scale just doesn’t make sense for straight SA retail money
It is ironic that you can use your money electronically without a middle man with cryptocurrency, but people choose to leave it with a middle man regardless.
Any recommendation of a bitcoin wallet for a Chromebook?
Somebody close to me put some money on bitcoins. I told him to get a wallet and move the coins to the wallet where he is in control of they keys. This person only has a Chromebook as a computer.
Does anybody have any recommendations of a software wallet for a Chromebook?
[+] [-] azinman2|4 years ago|reply
[+] [-] dragontamer|4 years ago|reply
Then the wrong child becomes the leader of the family and and bam, they start reducing the silver weight and replacing the coins with cheaper metals and the entire trust in that coin disappears.
And that ignores issues like the Conquistadors coming back from the new world with literally tons of gold / silver and royally messing up the gold / silver coinage economy.
[+] [-] nerfhammer|4 years ago|reply
https://en.wikipedia.org/wiki/Wildcat_banking
It wasn't fiat money, they were deposit notes representing gold or silver. And while outright fraud wasn't much of an issue since physical banks can't just disappear and leave town overnight, if the bank collapsed the currency would probably not be redeemable anymore.
[+] [-] cowvin|4 years ago|reply
The first banks would have dealt mostly with physical money / gold, so it would be a lot harder to pull off this kind of fraud.
[+] [-] tedunangst|4 years ago|reply
[+] [-] prepend|4 years ago|reply
[+] [-] marc__1|4 years ago|reply
Case in point:
https://en.wikipedia.org/wiki/Danske_Bank_money_laundering_s...
https://www.cnn.com/2021/01/21/europe/vatican-bank-money-lau...
https://www.justice.gov/opa/pr/bank-julius-baer-agrees-pay-m...
[+] [-] anonyxyz|4 years ago|reply
[+] [-] doggodaddo78|4 years ago|reply
Banks and municipalities who issued their own fiat currencies I believe encountered many more problems.
[+] [-] ffhhj|4 years ago|reply
https://en.wikipedia.org/wiki/Diogenes
[+] [-] rchaud|4 years ago|reply
A lot of what's happening in the crypto space is just self-professed libertarians re-discovering fire. They start off by being skeptical of banks and monetary authorities, but eventually realize that an unregulated free-for-all attracts bad actors that ruin it for everyone else. Hence the wet blanket of AML + KYC + Deposit ratios.
[+] [-] makomk|4 years ago|reply
[+] [-] an_opabinia|4 years ago|reply
[+] [-] thesausageking|4 years ago|reply
[+] [-] vmception|4 years ago|reply
https://www.afponline.org/publications-data-tools/reports/su...
Its just as large and just as consequence free as bitcoin/crypto heists and fraud despite the paper trail
Some reinforce their respect of one system by looking at the proportions of the money supply and transactions, I would say that isnt that important as the industry / interest in fraud has a fixed size
[+] [-] SunshineReggae|4 years ago|reply
Given Bitcoins track record, it wouldn't surprise me if some of the funds would belong to quite questionable characters, so you are basically stealing money from organized crime groups.
It is obvious that you can buy some protection with $3.6B, however your face and name is publicly known, meaning that you will be on the run for the rest of your life or possibly face a very gruesome death.
Is that really worth it?
[+] [-] vmception|4 years ago|reply
Basically, life isnt worth living poor, or the current state of the world isnt worth being unable to change. Death is more favorable than skimming table scraps.
Although the luxury consumptive spending is a tiny portion of what is possible, and nobody can take those experiences away from you, the funds contributed to charities, political campaigns, and investments allow shaping the world as you see fit now.
So thats the explanation, without justifying it. Despite recent attempts of making society seem more fair, this has always been the history of the world. Seize and lock in a millennium of control and favor for your family.
[+] [-] miohtama|4 years ago|reply
https://www.coindesk.com/promoters-of-crypto-ponzi-scheme-on...
[+] [-] majani|4 years ago|reply
[+] [-] rightbyte|4 years ago|reply
[+] [-] dorgo|4 years ago|reply
[+] [-] moneywoes|4 years ago|reply
[+] [-] Animats|4 years ago|reply
[+] [-] dkjaudyeqooe|4 years ago|reply
That combination was sort of inevitable.
[+] [-] FabHK|4 years ago|reply
[+] [-] agumonkey|4 years ago|reply
[+] [-] Cipater|4 years ago|reply
and
While South Africa’s Finance Sector Conduct Authority is also looking into Africrypt, it is currently prohibited from launching a formal investigation because crypto assets are not legally considered financial products, according to the regulator’s head of enforcement, Brandon Topham. The police have not yet responded to a request for comment.
$3.6B is 1% of South Africa's GDP. That's a lot of money.
[+] [-] rchaud|4 years ago|reply
Could be down 40% or more by now. GDP isn't nearly as volatile.
[+] [-] phantom_oracle|4 years ago|reply
$3.6B = ZAR51.17B (xe.com). That seems like a lot of savings for the small upper/middle class.
The name of the crypto company "afri" suggests it might have targeted the African market as a whole.
Can any Africans/South Africans explain how ZAR51.17B of savings accumulated in this crypto company(or scam)?
Is it like Madoff who conned rich people or did these guys manage to reach pensioners and steal their money too?
[+] [-] Beehivewax|4 years ago|reply
[1] https://www.goodthingsguy.com/opinion/perspective-salary-sou...
[+] [-] jonathanlydall|4 years ago|reply
The figure is slightly inflated as it’s the value at Bitcoin’s high earlier this year, but it’s still a lot.
My theory is lots of international customers as I don’t see our market being big enough, thumb sucking, but I reckon 2/3 of our country earns less than 500USD a month. Maybe their customers are from other African countries, but it feels unlikely to be enough.
Perhaps they had some “whale” clientele from several different countries.
I wouldn’t personally think the “Afri” in their name is particularly meaningful, it’s just a naming thing, but maybe some people treat it differently.
[+] [-] joshuahedlund|4 years ago|reply
Need someone with context knowledge, but I suppose the name suggests it could also have been targeting Afrikaners in South Africa (ex. "AfriForum"[0])
[0]https://en.wikipedia.org/wiki/AfriForum
[+] [-] valas|4 years ago|reply
[+] [-] unknown|4 years ago|reply
[deleted]
[+] [-] miohtama|4 years ago|reply
https://en.wikipedia.org/wiki/Albanian_Civil_War
[+] [-] Havoc|4 years ago|reply
[+] [-] throw7|4 years ago|reply
That doesn't make any sense to me if bitcoin is truly a trustable public ledger.
[+] [-] CyberDildonics|4 years ago|reply
[+] [-] jokoon|4 years ago|reply
I mean just to document and warn new comers.
It seems we already forgot about mtgow.
[+] [-] swayson|4 years ago|reply
[+] [-] YoungWeb|4 years ago|reply
[+] [-] Bombthecat|4 years ago|reply
[+] [-] bserge|4 years ago|reply
Literally the dream of the evil execs in Ready Player One, "75% screen coverage for ads before inducing epilepsy".
[+] [-] jessaustin|4 years ago|reply
https://ublockorigin.com/
That isn't helpful on mobile Chrome, but that's why I only use Firefox on mobile.
[+] [-] benrapscallion|4 years ago|reply
[+] [-] chx|4 years ago|reply
[+] [-] aaroninsf|4 years ago|reply
Teasing 20K by the weekend...
[+] [-] dreyfan|4 years ago|reply
[+] [-] doggodaddo78|4 years ago|reply
Deposit your BTC for safekeeping today!
[+] [-] torcete|4 years ago|reply
Somebody close to me put some money on bitcoins. I told him to get a wallet and move the coins to the wallet where he is in control of they keys. This person only has a Chromebook as a computer.
Does anybody have any recommendations of a software wallet for a Chromebook?