Hundreds of thousands of investors fear that their savings are lost and the Turkish government has blocked the bank accounts of Thodex, one of the country’s largest crypto exchanges, after its 27-year-old CEO, Faruk Fatih Ozer, fled the country.
Investors could have lost as much as $2 billion, according to Haberturk newspaper. A lawyer for the victims said about 390,000 active users have funds that are “irretrievable,” Bloomberg reported. Police searched the Istanbul headquarters of the company and thousands of Turks filed criminal complaints, saying they had been scammed and couldn’t access their accounts.
Thodex CEO Ozer said the company had run into financial difficulties and he promised to repay investors and return to Turkey to face justice afterward, Bloomberg reported. Ozer disputes the 390,000 figure and said that instead, about 30,000 users have been impacted, according to a statement Thursday on the company’s website.
In March, Thodex tried to boost membership by offering millions of free Dogecoins to new account holders. The website said 4 million coins were distributed, but many people complained on social media that they never received them.
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In a statement, Ozer said that he’s a high-school dropout and one of three siblings born to a civil servant. He said he thought about either committing suicide or surrendering to authorities, but neither was an option because he said they meant clients’ assets would never be retrieved, Bloomberg reported. “So I decided to stay alive and fight, work and repay my debts to you. The day I repay all my debt, I will return to my country and give myself in to justice.”
People in Turkey have increasingly turned to cryptocurrencies as a hedge against inflation, which was higher than 16 percent in March due to a volatile local currency and a spike in oil prices. Although crypto has been unregulated, the central bank of Turkey announced earlier in April that it was banning the use of cryptocurrencies for payments.
This added “to factors that sent Bitcoin down 14 percent at the weekend,” Reuters reported. “Turkey’s central bank cited ‘irreparable’ damages and transaction risks as reasons for the ban.”
Istanbul police said CEO Ozer flew to the Albanian capital of Tirana on Tuesday.
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