Cape Town - A group of investors who had put their money in an international cryptocurrency, promoted to them by among others former ANC Western Cape leader Marius Fransman, just before the Covid-19 pandemic struck, are now concerned that they might not get their investment back.
Fransman was reported in the media as having received over 2 000 applications for the token from investors, who included actors, writers, musicians and directors who wanted to join the SA Fight to Fame project.
One investor, who spoke on condition of anonymity, said: “When they were marketing the cryptocurrency to us they assured us that we could withdraw our funds after nine months, but when the time came, we were told that they could only get a portion of their funds but as a loan.
Investors put their money in tokens known as the Fight to Fame or F2F token, which was meant to be comparable to Bitcoin in the global cryptocurrency industry.
The F2F token was used to promote an international TV reality boxing show called Fight to Fame in which fighters hoped to transition into action film super stars of the calibre of Sylvester Stallone, Arnold Schwarzenegger, Dwayne Johnson and Jet Li.
What this meant in South Africa was that Fransman’s company, F2F SA, would host large entertainment events at venues such as big casinos, where the tokens would be the means to access the venue and also to be exchanged for gambling chips.
The token was marketed as being based on the Blockchain, Movies and Sport or BMS model.
Blockchain is described as essentially a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems.
Fintech specialist Andrea Tucker explained that while in South Africa blockchain is mostly being used in the cryptocurrency space, one of the main challenges is the lack of regulation.
“Even in crypto circles, enthusiasts are torn between the benefits of regulation and the potential drawbacks.
“But the technology itself addresses these concerns: transactions on the block are transparent and traceable, significantly reducing the opportunities for fraud and corruption if scoped and implemented correctly. Regulation could furthermore address risks such as scams,” said Tucker.
Speaking to the Cape Argus, Fransman said F2F SA had anticipated that the national lockdown introduced during March 2020 would be sufficiently relaxed by December 2020, when they had planned to launch the F2F international coin offering (ICO).
“The unpredictability of Covid-19 and its variants has meant that the ICO could not take place then or now, at least until the pandemic starts to dissipate or die down completely.
“Arising from this hiatus, F2F SA has now received requests from various individuals wishing to opt out, as they have their own challenges.
“This was not intended as part of the model developed by F2F SA. It was intended that individuals would trade in their tokens after the launch of the ICO.
“To this end and based on the on-going reality arising from the pandemic, F2FSA would be willing to consider, on a case-by-case basis, to buy back the tokens of those who have purchased them,” said Fransman.
mwangi.githahu@inl.co.za