Africa Bitcoin Corporation, the JSE-listed company that became the first on the continent to hold bitcoin as its main treasury asset, has spent the past six weeks dealing with a leadership crisis that started with a regulator and has now reached its board.
How it started
On 1 September the company told investors that South Africa's Financial Sector Conduct Authority (FSCA) had issued decisions against three senior people: CEO Warren Wheatley, chief investment officer Akshay Karan and head of media and investor relations Tatum Wheatley, Daily Investor reported.
According to TechCentral, the FSCA found that in September 2022 the three acted together to create an artificially inflated share price and a false appearance of trading in shares of Altvest Capital, the company's former name. The regulator imposed penalties of R5 million, R3 million and R2 million and debarred all three for 20 years. They dispute the findings and plan to take them to the Financial Services Tribunal.
The company stressed that no finding was made against any group entity. It placed Wheatley and Karan on precautionary leave, suspended Tatum Wheatley's consulting services, and appointed executive director Stafford Masie, formerly Google's first country manager in South Africa, as interim CEO. Wheatley resigned as a director on 31 August and then as CEO and employee on 21 September, with no reason or terms disclosed.
Now the board
The turmoil has not stopped at the executive level. TechCentral has since reported that the company's board has quit amid a clash with shareholders. The details of that dispute and who will govern the company next have not yet been fully disclosed, and AfroTech Horizon will update this story as the company's formal announcements come through.
Why it matters
Africa Bitcoin Corporation tried to copy Michael Saylor's Strategy model in Africa: rename the company, announce plans to raise up to $210 million and use it to buy bitcoin. It moved from the AltX to the JSE main board in May. But it holds only about 5.5 bitcoin, according to TechCentral, and its shares are thinly traded, so prices can swing sharply on small volumes.
For African investors, the episode is a reminder that a fashionable strategy does not replace basic governance. For regulators, it shows the FSCA is willing to act against senior executives of listed companies. For the wider crypto industry in South Africa, which is working hard to be seen as legitimate, it is an unwelcome headline.