South Africa is seeing a significant rise in cryptocurrency scams, driven by rapid growth in the use of these assets, especially with increasing interest in them as a means of investment and quick profit. With poor security awareness and the absence of strict regulation, the country has become an easy target for hackers and scammers. This article aims to shed light on the reasons for the spread of this phenomenon, warn users of the most prominent signs of fraud, while providing practical tips to stay safe in the world of digital currencies.
What are Crypto Scams?
Cryptocurrency scams are deceptive attempts aimed at stealing money or personal information from people using techniques or promises associated with cryptocurrencies such as Bitcoin or Ethereum. Scammers take advantage of people’s ignorance or desire for quick profit.
Simplified definition of digital fraud:
Digital fraud is any illegal activity carried out online with the aim of deceiving individuals to obtain their money or data, using means such as fake messages, fake websites, or false offers
Common types of crypto scams:
The Ponzi Scheme (hierarchical):
Promises fixed returns in exchange for inviting others to invest.
Phishing (trolling):
Sending fake messages or links to steal your private keys or data.
Rug Pulls:
They launch a new project, raise money, and then disappear.
Fake Wallets:
Apps or websites that claim to be wallets but steal your money.
Giveaway Scams (fake gifts):
They claim you’ve earned cryptocurrency, and they ask you to submit a fee first.
Impersonation Scams:
They use images of famous celebrities or companies to convince victims.
Most popular types of cryptocurrency scams in South Africa (2025)
1. Ponzi & Pyramid Schemes
It is one of the most common types.
Fraudsters promise victims huge returns for a small “investment”.
Old investors’ dividends are paid from new ones’ money, not real dividends.
2. Fake Crypto Exchanges
Seemingly legitimate websites or apps are being created for cryptocurrency trading.
Victims deposit their money and cannot withdraw it later.
They often make “tempting offers” to attract investors quickly.
3. Pump & Dump Coins
Scammers promote unknown currencies and increase their value through group purchases.
Then they suddenly sell their shares, causing the price to collapse and huge losses for other investors.
4. Phishing Attacks & Wallet Hacks
Victims are tricked into providing their wallet keys or sensitive information via fake links.
Technologies such as text messages, fake email, or fake apps are used.
5. Impersonation of Celebrities & Influencers
Scammers impersonate well-known financial or crypto influencers or celebrities.
They promote fake investments or fake giveaways to attract victims.
Warning signs: Indicators of fraud (Red Flags to Watch For)
Promises quick or guaranteed profits
Any entity that promises you big returns without risk, is often fraudulent.
Pressure to deposit quickly
Trying to rush you to send money without enough time to think or check.
Lack of licensing from official financial bodies
Such as FSCA or any recognized regulator.
Projects without a clear team or official website
The absence of transparency in information means a great risk.
Use of fake photos or alleged support from celebrities
Promoting via fake names or images to gain trust is a known fraudulent tactic.
The most famous cases of cryptocurrency fraud in South Africa
1. MTI (Mirror Trading International)
what happened?
It was founded in 2019 as a project to trade Bitcoin using automated trading algorithms.
It claimed to make daily profits of up to 10%.
It attracted about 23,000 Bitcoins from investors from South Africa and abroad (equivalent to more than $1 billion at the time).
In late 2020, CEO Johan Steenkamp suddenly disappeared.
It later turned out that the MTI system was a Ponzi scheme.
How was the scam done?
There was no real trading.
The profits claimed were from new investors’ money and not from trading.
Funds were withdrawn and directed to private accounts.
2. Africrypt
what happened?
It was founded by two young brothers, Rachel and Amir Qaji, in 2019.
They claimed to have an advanced cryptocurrency trading platform based on artificial intelligence.
In April 2021, they announced a security breach of the platform, and asked investors not to report it to the police.
Then they disappeared with a Bitcoin worth an estimated $3.6 billion (one of the largest thefts in crypto history).
How was the scam done?
It is suspected that the hack was fabricated.
Funds were withdrawn from client wallets to offshore wallets controlled by them.
How to protect yourself from cryptocurrency fraud in 2025?
To protect yourself from cryptocurrency fraud in 2025, follow these in brief:
Verify company and platform licenses: Only deal with licensed and regulated entities.
Use secure and reliable wallets: Choose wallets that support strong encryption and two-factor authentication.
Never share your private keys: a private key means ownership of coins, don’t give it to anyone.
Rely on reliable crypto news sources: avoid rumors, and check news from professional platforms.
Participate in local communities and stay informed: Connecting with others helps you detect scams early.
Useful Resources to Stay Safe in the Crypto Market
To ensure your security in the world of cryptocurrencies, use reliable sites like CoinMarketCap and CoinGecko to verify projects, and tools like Token Sniffer and GoPlus to scan smart contracts. Join active local communities on Telegram or Reddit to stay informed and share experiences, and don’t forget to develop your knowledge via trusted learning platforms like Binance Academy and Coinbase Learn.
The role of government and regulatory bodies in South Africa
The government and oversight bodies such as the Financial Sector Conduct Authority (FSCA) and the South African Reserve Bank (SARB) play a pivotal role in regulating the cryptocurrency market. The FSCA has begun implementing new laws requiring crypto service providers to obtain licenses and comply with strict standards, including know-your-customer (KYC) and anti-money laundering rules. These measures aim to protect users, reduce fraudulent activities, and create a safer and more transparent crypto environment within the country.