How a Ugandan Crypto Founder Was Abducted by Armed Impostors Stealing $500,000 in Shocking Heist

A formal report has been filed with the police, and investigations are underway. Mitroplus Labs alleges the involvement of a syndicate comprising informants, rogue security operatives, police, and two Chinese businessmen. The statement claims at least 48 similar cases have occurred in Uganda, often dismissed due to the influence of this syndicate.

CryptoGuru··5 min read

In a brazen attack that has sent shockwaves through Uganda’s cryptocurrency community, Festo Ivaibi, Founder of Mitroplus Labs and Afro Token, was abducted in May 2025, by armed individuals impersonating Uganda People’s Defence Forces (UPDF) operatives.

The assailants, dressed in military uniforms and wielding firearms, intercepted Ivaibi near his residence on Bunamwaya Road. Under duress, they compelled him to transfer $500,000 (approximately UGX 1.9 billion) in cryptocurrency from his wallets, including Binance, to their Trust Wallet.

Mitroplus Labs released a statement confirming the incident, noting that the attackers forced Ivaibi to access multiple crypto wallets and execute a small sale of Afro Token. This action briefly impacted the market, but it has since stabilized. The company emphasized that no community funds were compromised beyond the forced sale, and their tech and security teams acted swiftly to wipe compromised devices and secure all wallets.

A formal report was filed with the police, and investigations are underway. Mitroplus Labs alleges the involvement of a syndicate comprising informants, rogue security operatives, police, and two Chinese businessmen. The statement claims at least 48 similar cases have occurred in Uganda, often dismissed due to the influence of this syndicate.

 

Rahmah Kizito, a crypto trader and fashionista, expressed his outrage and concern over the incident:

“I’m still processing what happened to my brother and friend Festo Ivaibi,” he said.

“A man who has poured his energy into educating and empowering others through crypto and Web3, abducted at gunpoint by thieves posing as UPDF operatives and in uniform, threatened, and forced to surrender his crypto wallets under duress. This isn’t just about money. It’s about the risks innovators face in unregulated environments.

We need protection. We need regulation. We need to make sure this never happens again.”

 

Kasim Mpanga, a crypto enthusiast, also voiced his support for Ivaibi on X (formerly Twitter), stating:

“We are heartbroken to hear about the horrific ordeal you endured. No one should face such a violation, and our hearts ache for you and your family. We keep you in our prayers as you navigate this pain.

Your resilience and commitment to a secure crypto ecosystem inspire us all. Stay strong.”

In May 2025, Ugandan law enforcement arrested one of the suspects involved in the abduction crypto trader and educator Festo Ivaibi. The arrest occurred after forensic experts traced the stolen funds to Phineous Biira’s verified wallet with a major centralized cryptocurrency exchange.

Nevertheless, Mitroplus Labs’ statement expressed alarm at growing evidence supporting the assertion that UDF members are involved in the abductions. The educational institution also disclosed that most of the $500,000 in digital assets reported stolen was taken from Ivaibi’s crypto wallets. The gang also stole and liquidated $18,000 in digital funds from Afrotoken, a Mitroplus Labs-issued memecoin on Tronlink, briefly causing the token’s price to drop.

The incident has reignited calls for stricter regulation of Uganda’s cryptocurrency sector, which has seen a surge in scams and fraudulent schemes in recent years.

According to previous report by BitKE, Uganda has become a hotbed for cryptocurrency scams, with schemes like OneCoin defrauding many Ugandans.


Mitroplus Labs, a free learning hub for crypto education across Africa, reiterated its commitment to fostering a secure and transparent crypto ecosystem despite the challenges posed by bad actors. The company urged its community to tighten security protocols, practice safe wallet storage, and remain cautious about discussing assets publicly.

In a 2023 interview, Ivaibi highlighted the proliferation of crypto scams in Africa, attributing them to limited educational efforts and a lack of regulatory frameworks. He emphasized the need for governments to create a friendly environment for blockchain technology to grow while studying and learning how to regulate it.


Despite the growing interest in cryptocurrencies, the Ugandan government has maintained a cautious stance. In a statement, as reported by BitKE back in 2020, the Ministry of Finance warned the public against cryptocurrencies, stating that the government does not recognize any cryptocurrency as legal tender and has not licensed any organization to sell or facilitate trade in cryptocurrencies.

In 2021, as reported by BitKE, the Financial Intelligence Authority of Uganda (FIA Uganda) requested the Ministry of Finance to come up with a framework to help regulate cryptocurrency operations in the country. This request came following non-compliance by various crypto operators in the country to register their operations – a call which went out in late 2020.

See also

In 2022, the Bank of Uganda (BoU) issued a circular to all payments service providers, especially mobile money operators, reminding them to desist from facilitating cryptocurrency transactions. As such, the apex bank further reminded payments players that its position on cryptocurrencies had not changed since 2019 when it stated that it did not allow financial service providers to facilitate trade in cryptocurrencies, or even trade directly.


As investigations continue, the crypto community in Uganda remains on high alert, advocating for increased security measures and regulatory oversight to protect innovators and investors alike.

 

 

 

Follow us on X for latest posts and updates

Join and interact with our Telegram community

______________________________________

Related
All Rights Reserved - BitcoinKe.io
2020 © Zeen World News