Wannabe Rural "Investors" Lose Millions As Bitcoin Ponzi Scheme Dries Up of Cash

Just a month ago we carried a report on the once bustling scheme which was being run in Ladysmith, South Africa. The popular ponzi scheme, dubbed Bitcoin Wallet, which hoodwinked desperate investors to believe they could make a tenfold return on money invested has reportedly run out of cash.

Investors have turned into protestors demanding their investments back as per a report from the Ladysmith Gazette. Tensions have quickly risen in the small town since the company shutdown it's doors on the 4th of July as there was increased attention from authorities about it's legality.

Bitcoin Wallet founder Sphelele “Sgumza” Mbatha admitted to the Ladysmith Gazette on Saturday that he doesn’t have any more cash to pay out to clients. The one-time small town celebrity and hero has quickly turned into a villain as his former backers want to know where their money is now that the firm has shut it's doors.

“I don’t know what’s going on. I don’t know online or how this system works. [It has] to be workshopped,” he said.

In previous interviews with ANA, Mbatha had not been clear about the operations of the scheme. Mbatha stated funds entrusted to Bitcoin Wallets were reinvested in cryptocurrencies and then resold to the market at a higher price. Later, Mbatha declined a follow up interview stating, “time is money.”

The former paramedic now claims that he was only "the manager of the Ladysmith branch" and apparently has he own funds held within the "system."

“I won’t continue working. I don’t have cash anymore. The owner says people must go online and collect their money online. I, myself, have invested my money in there. I submitted my banking details online, and now I am also waiting.”

Will the authorities move to ensure that the rural folk of Ladysmith get justice for this cruel ripoff? Mind you, this is a man who was reportedly getting a police escort despite all the red flags surrounding his operations.

Who must take the blame for the fall of the house of cards?

Header Image Credit: Watts