South Africa Investigates $80 Million Bitcoin Ponzi Scheme That Collapsed After Its Founder Disappeared

  • South African authorities are currently looking into an alleged bitocin Ponzi scheme that swindled investors out of $80 million.
  • The scheme's founder reportedly disappeared, alhtough some believe he never existed in the first place.

South African authorities are reportedly investigating an alleged bitcoin Ponzi scheme that fell apart after its founder, dubbed Steven Twain, mysteriously disappeared. According to Reuters, the scam defrauded investors out of 1 billion rand ($80 million) after promising them huge returns that never materialized.

The Ponzi scheme was reportedly being run by a company named BTC Global, which grabbed investors by promising them returns of 2 percent per day, 14 percent a week, and as much as 50 percent per month. At press time, the company’s services have been suspended.

Through a statement, South Africa’s police stated:

“Members of the public are believed to have been targeted as part of the scam and encouraged by agents of BTC Global. Some of the investors got paid in terms of the agreement. However, the payments suddenly stopped.”

South African police

​​​​​​​According to news source Fin24, various victims banded together on social media, and now some believe Twain was an alias and not a real person, although there are several blogs that claim he was indeed a real person. A blog owner named Cheri Ward has revealed she met Twain on “messenger and email,” but never in person. Ward was quoted as saying:

“I pushed him for a live video and asked him to address us all on Skype. He was dead set against it. I knew that if I pushed harder he would pull away. As a leadership we decided that we would let him have his peace, he had after all been making payments on time every Monday to hundreds of people without any trouble.”

Cheri Ward

​​​​​​​BTC Global’s website, at press time, claims that the “admin team cannot locate him,” and asks for those with information to step forward. It adds that the team behind the alleged scheme is “as shocked and angry as everyone,” while adding that everyone “knew the risks involved in placing funds with Steven.”

Per police investigator Yolisa Matakata, the $80 million investors were reportedly swindled out of may just be the tip of the iceberg, as there are “potentially thousands more yet to discover they’ve lost money.”

This case follows one in which South African police detained three in a kidnapping case, in which the criminals demanded a 15 BTC ransom (worth about $120,000) to release a teenage boy.

Last month South African authorities revealed they expected taxpayers to declare their cryptocurrency gains, although the central bank was still in the process of discovering whether these comply with its financial surveillance regulations.

Coinbase’s New ‘Bridge’ Links Coinbase Wallet to Your Desktop Browser

Crypto exchange has announced a new feature (called "WalletLink") for Coinbase Wallet, its non-custodial mobile wallet, that makes it possible to link decentalized applications (DApps) running on your desktop browser to the Coinbase Wallet app on your mobile phone.

What Is Coinbase Wallet?

Here is how Coinbase explains the differences between Coinbase.com and Coinbase Wallet:

"Coinbase.com a.k.a Coinbase Consumer is a digital currency brokerage - you use it to buy or sell cryptocurrency in exchange for fiat currency (i.e. USD or your local currency). Coinbase Consumer can also act as a custodian, storing your digital currency for you after you purchase it. Coinbase Consumer is available in 32 countries.

"Wallet is a user-custodied digital currency wallet and DApp browser. This means that with Wallet, the private keys (that represent ownership of the cryptocurrency) are stored directly on your device and not with a centralized exchange like Coinbase Consumer. You do not need a Coinbase Consumer account to use Wallet and you can download Wallet from anywhere in the world."

What is WalletLink?

In a blog post published on Thursday (August 22), Coinbase Wallet Product Lead Siddharth Coelho-Prabhu announced that Coinbase Wallet users can now use their favorite DApps "on any desktop browser with Coinbase Wallet’s WalletLink," with WalletLink acting "as a secure bridge between your Coinbase Wallet app and your desktop browser."

All you need to start using this new feature is to "scan a WalletLink QR code with your Wallet app." 

Using DApps Outside Coinbase Wallet's Integrated DApp Browser

The Coinbase Wallet Product Lead says that although using DApps via Coinbase Wallet's integrated DApp browser has been a great experience on mobile phones, the desktop experience has been quite different and much poorer:

Users on desktop web browsers have had to resort to installing clunky browser extensions, copying and pasting private keys across devices, and seeing fragmented wallet balances.

The Coinbase Wallet team is hoping that WalletLink will adequately address this issue.

Getting Started With WalletLink

Here is what you need to do:

  • Ensure that you've got "the latest version of Coinbase Wallet (version 19.1 on iOS and 18.0 on Android)." 
  • Visit any of the DApps that have integrated with WalletLink; currently, Compound, dYdX, IDEX, and Maker are supporting WalletLink (and UniSwap will offer integration with WalletLink soon).
  • Tap on "the option to connect your Coinbase Wallet."
  • Scan the QR code with Coinbase Wallet's QR scanner (this creates a secure connection between the Coinbase Wallet mobile app and your desktop browser).
  • Approve access to the DApp.

From now on, "whenever you submit a transaction, you’ll get a ping on your phone for you to approve the transaction."

Note that WalletLink "also supports persistent connections to multiple dapps, so you don’t have to scan a QR code each time you want to use a new dapp."

The Coinbase Wallet team have tested WalletLink with the following desktop browsers: Google Chrome, Mozilla Firefox, Microsoft Edge, Brave, and Opera.