Explained: The Africrypt “Hack”

Africrypt is a cryptocurrency exchange that recently took the title of the biggest scam in crypto to date.  Ameer and Raees Cajee, the brothers who founded the exchange, have been reported to be missing in June 2021 after claiming that almost $3.6 billion invested in the protocol was lost in a “hack” a few months ago.

Inside the Incident

The Africrypt incident began in April 2021.  At the time, one of the founders of the protocol contacted investors informing them that the protocol had been hacked.  The founder requested that investors not contact lawyers or law enforcement as it would “delay the recovery process.” 

However, seven days before the alleged hack, Africrypt employees lost access to the exchange’s back-end platforms, which makes this report suspicious. After receiving the notice of the “hack” and its suspicious request not to reach out to lawyers and law enforcement, some investors contracted a law firm, Hanekom Attorneys.  Investigation by the firm found that much of the cryptocurrency invested with the exchange had been extracted and sent through tumblers and mixers to make it more difficult to track.  

Additionally, some of the wallets that funds were drained into during the “hack” were wallets known to be owned by the Cajees while they were still operating them.

Attempts by Hanekom Attorneys to contact or locate the Cajee brothers have been unsuccessful.  They allegedly left for the UK days after the hack, and the exchange’s website has been taken down and calls to the brothers’ phones go directly to voicemail.

Lessons Learned from the Hack

Africrypt was a cryptocurrency exchange that made unrealistic promises to investors.  For example, the project occasionally claimed that it could net 10% daily returns for investors.  

These and similar claims that “seem too good to be true” should be warning signs for any investor.

The Africrypt incident takes the title of the biggest crypto scam to date with a price tag of nearly $3.6 billion for investors.  Before investing in any crypto project, do your research.  If it seems too good to be true, it probably is.