- Postbank lost more than $3.2 million after suspected employees stole the master key.
- The South African bank will reportedly spend $58 million to replace 12 million cards.
- Bitcoin trading and search interest in cryptocurrency is surging across Africa.
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South Africa’s Postbank, the banking subsidiary of the state-owned South African Post Office, reportedly lost more than $3.2 million to fraudulent charges after suspected employees stole the bank’s master key.
From March to December 2019, the master key was used to make more than 25,000 transactions, gradually siphoning 56 million rand ($3.26 million) from customers’ accounts.
Ultimately, the process of replacing customer cards—including both banking cards and government benefits cards—will cost Postbank more in the long run. The Sunday Times reports that the bank will spend more than 1 billion rand ($58 million) to address the breach.
The unnamed researcher behind the @Bank_Security Twitter account told ZDNet that bank codes are usually split across various managers and executives to avoid such security breaches, and that banks often also change the key and the people holding it.
In this case, it appears that a single point of failure created a major and costly problem for Postbank.
Crypto keeps surging
The Postbank report comes during a time in which interest in which blockchain-based cryptocurrencies—which are designed to eliminate single points of failure—is surging across Africa, as highlighted in a recent Amazon Prime documentary.
In May, Bitcoin trading in Africa broke a volume record less than two weeks after setting the previous all-time high. And according to a map published by Blockchain Center (via AtoZ Markets) this week, Bitcoin searches on Google are still soaring in Africa, particularly in Kenya.
Following an African trip in November 2019, Dorsey tweeted, “Africa will define the future (especially the bitcoin one!),” and announced plans to live in the country for several months in 2020. However, the COVID-19 pandemic halted his plans.