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Despite the two major cities in eastern Democratic Republic of Congo having fallen into the hands of the M23 militia, some residents are celebrating their newfound fortunes, amassed through cryptocurrency trading.
Crypto trading is seemingly a silver bullet to the economic crisis plaguing the region, where banks have been ordered closed by the Kinshasa authorities to prevent the funding of the Rwanda-backed rebels, but it often conceals well-organised scams exploiting the already struggling population.
“With $1,000 in investments, I earn between $672 and $700 each month,” boasted John, a civil servant and artist, sitting under a parasol on the popular “beer avenue” in South Kivu’s capital, Bukavu.
“My first investment was $800. After 30 days, I withdrew $480 and left $1,000 in my account. Currently, I easily reach $2,000 or $4,000, which allows me to advance my businesses, my projects and repay my debts,” he said while sipping an imported beer, the only option since the local brewery shut down due to the fighting.
The only condition, he said, is to connect several times a day and refer other people to join the obscure online trading platform, which claims to be a foundation established in the United States.
The business resembles a pyramid scheme, whose profits rely entirely on recruiting new members and risk the ruin of its investors.
In the Central African country, ranked among the poorest in the world, ravaged by decades of conflict, online scams have found “fertile ground,” said Justin Murhula, a digital security trainer in Bukavu.
“Many people, in search of easy gains given the current state of vulnerability, get carried away,” he said.
‘No office’
Kinshasa inked an agreement with the M23 for a permanent ceasefire in Doha in July, after the DRC and Rwanda signed a US-brokered deal aimed at ending the conflict in June, but those efforts have yet to stop the violence, let alone reopen banks or bring economic relief.
The M23, which has taken the two main eastern cities of Goma and Bukavu, has imposed several taxes to finance its parallel administration while urging residents to opt for mobile payment solutions.
And with police stations and courts abandoned since the armed group’s arrival, there is no mechanism or authority to combat scams in the region.
From phishing to fake messages from relatives or international organisations, online scams have proliferated in DRC and its neighbours since before the resurgence of the M23, with several Ponzi schemes resulting in bankruptcies.
Under the parasols in Bukavu, crypto trader John was not convincing all his companions with his fortune.
“In 2018, I fell victim to scammers. The idea was to deposit an amount equal to or greater than $200 and earn monthly interest through an online system where you could see how it accumulated,” said Justin, an entrepreneur who declined to provide his full name.
He lost everything a month later, he said. “The system was blocked.”
Bukavu lawyer Pascal Mupenda told AFP he is constantly solicited by similar platforms.
“They managed to convince three of my colleagues,” he sighed.
In a country where about 73 per cent of the population lives on less than $2 a day, for some, the opportunity to try their luck outweighs the risks.
AFP
