An arm of CDIN that focuses on protecting the public from toxic assets and combating criminal activity in the cryptocurrency space and Blockchain, the Nigeria Blockchain Alliance, hereinafter NBA, has recovered the funds of several individuals who had fallen victim to bad actors within the space who attempted to defraud them.

Investigating fraud and helping victims get their money back

The NBA group brings together forensic experts, cyber security professionals, law enforcement agents and legal practitioners among others with the major goal of addressing the misperceptions about Bitcoin and other cryptocurrencies.

The NBA also leverages on the industry's good faith efforts to cooperate with each other in combating e-fraud as it intends to promote an approach to enforcement and regulation that does not stifle innovation.

Cybersecurity expert and a member of the NBA, Obiora Awogu tells Cointelegraph about the efforts of his team in fighting crimes associated with Bitcoin and cryptocurrency in Nigeria. Awogu notes that the successes recorded by the NBA have been in collaboration with relevant government agencies and institutions.

Awogu says:

“We had received complaints about several cases of cryptocurrency scams and have recorded success in investigating these frauds and helping the victims get their money back. All of these have been achieved with the support and collaboration of regulators, LEAs and financial institutions.”

A victim’s story

Ifeanyi Obodoeze, currently on National Youth Service in Kebbi state is one of the beneficiaries of the actions of the NBA. Obodoeze tells Cointelegraph about the alleged scam he was robbed of NGN 118,750 as he attempted to buy Bitcoins from an acclaimed seller.

The culprit with whom Obodoeze connected in a social group on telegram had negotiated to sell $250 worth of Bitcoins to his victim at NGN 118,750 but acted otherwise after receiving credit.

“We had agreed on the terms of transaction before I transferred NGN 118,750 to the seller. To my disappointment, he sent me just $2 instead of the $250 after which he blocked every means of my contacting him,” says Obodoeze.

Obodoeze says that on recommendation, he sent an email to the official NBA email address with every detail of the transaction. All it took was a space of five days and he had his funds returned in full at no cost whatsoever.

Obodoeze expresses joy not just at the quick recovery of his stolen funds but also on the lessons he has learned through the NBA on ways to protect his wealth.

Fatore Adebayo also tells Cointelegraph that through the NBA, one of the fraudsters who allegedly scammed him in the guise of selling Bitcoins was tracked down and arrested. This he said was possible through yet another recommendation by a friend who is in touch with the CDIN.

Bitcoin is not yet absolutely private

The dynamics of petty scams within the cryptocurrency ecosystem is an ongoing concern. Tracking down the alleged fraudsters has involved the collaboration of regulatory agencies and financial institutions. This is possible due to the KYC systems of these agencies and to some extent of law enforcement by relevant government agencies.

Placed side by side with the quest for privacy and anonymity by a larger part of the Bitcoin society resurrects the continued argument about the extent of government participation within the ecosystem.

Olakunle Peter Taiwo, a member of CDIN explains that Bitcoin is a private currency that cannot be controlled by the government. However, he notes that regulation is important for the benefit of usability of Bitcoin, which naturally affect its price and its store value.

Taiwo says:

“Bitcoin cannot be controlled government, it is companies and users that will be affected by the activities of government regulations. Regulations, just like what the NBA is doing in protecting the Nigerian public from criminal elements or toxic products and services in the Blockchain and cryptocurrency ecosystem.”

Taiwo concludes by saying that regulation is important to monitor not the Bitcoin but various players within the crypto-ecosystem.

It is, therefore, essential to note that until Bitcoin goes mainstream and acquires a high level of independence from existing systems, government intervention remains inevitable.

The need to exchange Bitcoin and other cryptocurrencies for fiat money will always introduce a third party into the cycle of most transactions thereby denying an absolute peer-to-peer expression of the system until massive adoption is achieved.