The founder of a popular encryption mechanism in Turkey has disappeared, with media reports indicating that he has fled the country with $ 2 billion, as some 300,000 frustrated users have suddenly lost access to their accounts.
In Turkey, the national lira currency has been on a secular decline for nine consecutive years, urging people to take some risks in an attempt to protect their economies and perhaps even gain something. As a result, the recent rise in cryptocurrencies has predictably attracted many investors who hoped to protect their money and possibly earn a little more. But things did not go well for them, as Thodex, one of the largest cryptocurrency exchanges in the country, went bankrupt.
Governments cannot control cryptocurrencies. As a result, they can quickly rise to a higher point (or fall quickly), making them a particularly attractive investment tool – especially for those willing to take risks. In Turkey, anyone can establish an exchange cryptography with just 50,000 lire (about $ 6,000) of capital, reports Bloomberg. As a consequence, crypto exchanges are often managed by people without adequate financial education and serving unskilled investors who do not understand all the risks.
Thodex was one of Turkey’s largest cryptocurrency exchanges, with 700,000 users, many attracted by an introductory offer of ‘millions’ of free Dogecoins. Apparently, most of these Dogecoins were never distributed.
To make matters worse, media reports say that up to 391,000 users have suddenly lost access to their accounts. Following reports, Thodex “temporarily” closed the platform to resolve an “abnormal fluctuation in the company’s accounts”.
Meanwhile, Faruk Fatih Ozer, the founder of Thodex, flew to Albania, taking $ 2 billion in investor money with him, reports CNBC (citing local Turkish media). As expected, the Turkish Ministry of Justice is looking for a so-called “red notification” from Interpol to arrest Ozer.
Thodex denies all allegations and says the problem affects ‘only’ 30,000 of its customers. The company also claims that the inaccurate media report has ruined its reputation, making it impossible to continue operations.
“The claims that [accounts of] 391,000 people disappeared after a loss of approximately $ 2 billion, which was [reported] to the public on 22.04.2021, are unfounded,” says a statement from Thodex. “It is necessary to make this statement in order to respond urgently to these demands that go beyond the limits of honesty and conscience.”
The founder of Thodex promises to return investors’ money, but did not disclose how and when he plans to do so. Meanwhile, a lawyer representing investors said the money had become “unrecoverable”, according to Bloomberg.