They want the Cape High Court to bar the liquidators from incurring further legal costs in the UK, and then to have them removed entirely.
UK creditors in collapsed bitcoin scam Mirror Trading International (MTI) are asking the Cape High Court to restrain the eight liquidators from incurring any further legal costs in the UK and to either remove them or place them under supervision.
The case will be heard on Friday (12 December 2025) on an urgent basis.
In correspondence seen by Moneyweb, the liquidators say they will argue that they have been given insufficient time to prepare a response and will ask for a cost order against the investors.
MTI was the world’s largest crypto scam in 2020 according to Chainalysis, roping in more than 29 000 bitcoin on promises of earning up to 10% a month from a trading bot that was found not to exist.
It collapsed in late 2020 when investors’ demands for withdrawals went unanswered. Founder and CEO Johann Steynberg fled to Brazil, where he was later arrested for using false ID documents. He reportedly died in April 2024 while awaiting extradition to SA.
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The UK creditors say the MTI liquidators have already blown half of the R1.1 billion in assets recovered and “each day that passes involves further expenditure of estate cash on overseas legal fees currently estimated at tens to hundreds of millions of rands over 12-18 months,” say the court filings.
The creditors say the liquidators are issuing summons for recovery of bitcoin – at today’s prices, which are often eight or more times more than they cost back in 2020 – against thousands of MTI creditors around the world with the purpose of generating huge fees for themselves.
The liquidators receive 10% for all recoveries, plus legal and other fees.
The creditors argue it is in the liquidators’ self-interest to prolong litigation for years, even if the prospects of success are bleak, in the hope of earning more fees for themselves.
The problem the courts will have to decide on is whether the liquidators’ claims have prescribed (run out of time).
Hundreds of creditors in SA and abroad say they have, and are contesting the claims on this basis.
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‘Abuse of court process’
This latest case comes from a group of UK creditors who say the liquidators are running up enormous legal expenses on a doomed legal strategy. As such, it is an abuse of the court process, they argue.
On 8 November 2024 the UK court struck out the liquidators’ main application and awarded costs of R723 200 against the MTI estate.
This, say the creditors, demonstrates the fundamental legal defect in the liquidators’ claims, which many argue have prescribed.
On the same day as the UK strike-out against the liquidators, they re-issued “substantially identical” claims without addressing the prescription defects identified by the UK court.
“This demonstrates a pattern of reckless disregard for court guidance; the interests of creditors; and the preservation of Estate assets,” say the court filings.
The liquidators are pressing ahead with plans for a 10-day trial scheduled for the last quarter of 2026.
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Prescription, insolvency, and this matter
William Thyne, a director of attorneys Thyne Jacobs Sundstrom, provides a professional opinion on the law of prescription in SA, particularly as it applies to insolvency.
He says the liquidators had access to the Maxtra database, which detailed all MTI transactions, on or about 9 April 2021.
This gave them sufficient time to identify relevant debtors and launch claims against them within the requisite three-year prescription period.
Under Section 12(3) of the Prescription Act, Thyne says a claim is extinguished if the debtor can prove, on balance of probabilities, that the minimum material facts to institute proceedings were available to the joint liquidators on 9 April 2021.
“Accordingly, the prescription period applicable to the Joint Liquidators’ claims is three years from the date on which the Joint Liquidators knew, or with reasonable care ought to have known, the identity of each debtor and the facts giving rise to each claim as contemplated by section 12(3) of the Prescription Act,” says Thyne.
In other words, the liquidators are too late in pressing their claims against the UK creditors.
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They argue that the liquidators cannot present the Maxtra database as the source of their claims against debtors when it suits them, and then argue that further investigations were required in other cases where prescription is clearly involved.
“The ongoing pursuit of prescribed claims raises serious questions about compliance with fiduciary duties,” says Thyne.
“A liquidator owes duties to act in the interests of creditors with reasonable care, skill, and impartiality. To bring or persist in time-barred claims risks unnecessary cost, waste of estate resources, and potential exposure to adverse costs orders or judicial criticism.”
Arguing for the liquidators, Advocate Rudi van Rooyen says prescription does not commence until investigations are complete and expert validation obtained. However, there is case law disputing this.
The application by the UK investors is divided into two:
- The first part asks for interim relief restraining the liquidators from taking any further legal steps in the UK; and
- In the second part, they want the liquidators removed from the MTI case under Section 379 of the Insolvency Act, or alternatively placed under supervision in the UK.
This article was republished from Moneyweb. Read the original here.
