EQONEX CEO calls for regulation of crypto-trading platforms

The cryptocurrency industry is once again under scrutiny after the recent Afri-Cript heist, where the directors of the Afri-Cript Investment Company allegedly made off with $3.6 billion in client funds in Bitcoin. The brothers behind the scheme are believed to have fled to the United Kingdom, leaving clients frustrated and questioning the security of their investments. Richard Byworth, CEO at EQONEX, joined CNBC Africa to discuss the implications of this massive crypto scam. Byworth highlighted the inherent risks associated with cryptocurrency as a bearer asset, emphasizing that whoever holds the digital keys is the rightful owner. He likened the situation to someone running off with a bar of gold, stressing the importance of proper asset storage and security measures. The Afri-Cript heist represents the largest cryptocurrency scam to date, underscoring the need for increased regulation and governance in the industry. One of the key challenges facing the crypto sector is the lack of clear regulations governing third-party providers that facilitate asset storage. Byworth emphasized the importance of implementing robust oversight for platforms and custodians to protect investors' funds effectively. While Bitcoin itself operates on a decentralized network, the focus should be on regulating service providers to enhance security and prevent fraud. The prevalence of cyber attacks and fraud in the crypto space has raised concerns about the security of digital assets. Despite the common belief that Bitcoin transactions are secure, recent incidents have highlighted vulnerabilities that can be exploited by criminals. Byworth pointed out that Bitcoin's traceability can be advantageous in tracking illicit activities, as demonstrated by the FBI's successful recovery of funds in a recent ransomware attack in the US. Moreover, the recent crackdown on Bitcoin mining in China has further shaken the cryptocurrency markets. With China accounting for approximately 75% of global Bitcoin mining, regulatory actions by the Chinese government have significantly impacted the industry. Byworth suggested that the crackdown may be driven by China's focus on promoting the digital yuan and preventing competition from cryptocurrencies like Bitcoin. The environmental concerns raised by China and influential figures like Elon Musk have also played a role in shaping the regulatory landscape. As the crypto industry grapples with security challenges and regulatory uncertainties, stakeholders are increasingly calling for enhanced oversight and governance measures. The Afri-Cript heist serves as a stark reminder of the risks involved in digital asset investments and the need for comprehensive regulatory frameworks to protect investors and uphold the integrity of the market.