Will Breedt, who was behind a Bitcoin scam that targeted South Africans, was recently declared bankrupt. The ruling was made after one of the victims of the scam applied for a sequestration order against Will Breedt.
About the Scam
Will Breedt was the CEO of Vaultage Solutions (VS), a company that is at the center of the crypto scam. According to a local media report, around 2000 investors had invested about $13.35 million in the company.
Problems for investors began after Breedt cut off all communication before he flew to Mozambique on holiday in December 2019. In January, Breedt shut down the company after authorities began criminal investigations against him. He allegedly went underground as pressure began mounting.
Reports from South Africa indicate that Breedt’s problems began in November 2019. It was after the crypto market dived. Breedt held on hoping that the market would bounce back soon. However, the reports might be inaccurate. Charts from the period show that there was only one slump in the month and it occurred on November 25. The losses were reversed the next day and the price remained above $7,000 until the end of November 2019.
The local media publication also alludes to claims of fraud. According to anonymous sources quoted by the news agency, it is claimed that an account owned by Breedt, which previously held $3.15 million, had been emptied.
The implication of the Sequestration Order
The sequestration order has sent shock waves all across South Africa’s crypto industry. It will mean that all of Breedt’s assets will be managed by a trust unless Breedt appeals the order. Any assets he owns will be liquidated and used to compensate the investors. However, it could be a long time before that happens.
The revelation of the scam will no doubt hurt crypto adoption. Many people, who were already skeptical about the crypto sector, will be even more unwilling to invest in it. The South African crypto industry is already quite tiny and the report is going to slow down its growth.