A construction company has gone bankrupt after – reportedly – making a $3 million bet on cryptocurrency. It also reportedly donated half a million dollars to a Christian charity before it went under.
The company – Privium – mostly built homes, and went into liquidation at the end of 2021, a month after it was placed into voluntary administration.
In a report released this week, liquidators concluded that, since August, Privium had probably been trading while insolvent.
Its liquidation has left hundreds of Australian homes unfinished.
According to the ABC, Privium chief executive and founder Rob Harder said he was “deeply sorry” at the time of the collapse, in an email to “valued clients and suppliers.”
“I understand that this is not the news you wanted to hear and that this will create real difficulties,” he reportedly said in the email.
Privium was founded in 1999. Its business was building houses in Queensland, New South Wales and Victoria. Though Privium felt the pinch of the pandemic, particularly the long lockdowns in Victoria (and tighter lending conditions) news.com.au reports that “the administrators said other factors likely led to the downfall of the companies,” with one being “an investment of around $3 million in cryptocurrency” (news.com.au).
The Daily Mail reports: “It turned the cash into Bartercard dollars which were then converted in Qoin coin, a Gold Coast-based currency.”
As The Daily Mail put it: “Home builder tried to avoid going broke by making a $3million bet on cryptocurrency and donating to a Christian charity before it went under.”
The Daily Mail then cited the administrators’ report, which allegedly states: “Based on our investigations into the nature of Qoin, it is evident that it is an extremely illiquid asset with its sale limited to a few hundred dollars each day.”
“Consequently releasing this asset is extremely difficult, if not impossible.”
“Administrators believe it was a ‘possible breach’ of duties by directors,” The Daily Mail reports.
The report recommended Privium continue to be investigated but also pointed out it was unlikely the alleged culprits would have the money to pay back creditors.
Blockchain Australia expelled Qoin from its membership in February 2021. In March 2021, BTX capped the sale limit of Qoin to $125 per account, per day.
The ABC reported in November 2021 that “Salerno Law has released a potential claim against Qoin and the digital currency’s parent company BPS Financial Limited,” adding that “Qoin rejects potential class action allegations of ‘pyramid selling’, deception, citing ‘witch hunt.'”
The ABC also reported in November that Salerno Law’s website stated (at the time): “It has been alleged by holders and merchants that they are either unable to accept Qoin payments or exchange the token for fiat currency due to the terms of BTX Exchange, leaving them with a token of no utility.”