What is OneCoin?
Launched in 2014, OneCoin gained global attention by presenting itself as a cryptocurrency with enormous profit potential. Its aggressive marketing strategy focused on promises of quick returns and revolutionary blockchain technology. Unlike Bitcoin and other legitimate cryptocurrencies, OneCoin did not operate as a decentralised currency. Instead, it was structured as a multi-level marketing (MLM) scheme targeting people seeking financial success in the growing crypto space.
This MLM model played a key role in OneCoin’s expansion. Members were encouraged to recruit others, receiving commissions for every new investor they brought in. This strategy helped OneCoin spread quickly across continents, reaching millions of people worldwide. Promotional materials and events promised investors that OneCoin would soon rival Bitcoin and become the leading cryptocurrency. However, beneath the surface, OneCoin was a well-disguised Ponzi scheme.
Fraudulent claims
At its core, OneCoin claimed to offer a revolutionary decentralised currency built on blockchain technology. However, it lacked the transparency and decentralisation that define authentic cryptocurrencies. There was no verifiable blockchain, and the company controlled all token issuance and exchange aspects.
Investors purchased educational packages that included tokens supposedly used for mining OneCoins. These packages ranged from basic starter kits to expensive options costing thousands of euros. Each package promised access to higher mining power and greater profits. Over time, OneCoin raised over €4 billion from investors worldwide, all under the false promise of financial growth. Despite its grand claims, OneCoin’s underlying technology did not exist, leaving investors with worthless tokens.
The rise of OneCoin
Early growth
The creation of OneCoin resulted from a well-planned strategy by co-founders Ruja Ignatova and Karl Sebastian Greenwood. Ignatova, a charismatic entrepreneur, positioned OneCoin as a cryptocurrency that could compete directly with Bitcoin. The company promised potential investors a simple and risk-free way to profit from cryptocurrency, making it accessible even to those without technical experience.
Rapid expansion through mlm
OneCoin’s success largely stemmed from its MLM structure. Investors were incentivised to recruit new members by offering attractive commissions. Each new recruit brought in more funds, creating a pyramid-like structure that grew rapidly. Events promoting OneCoin were held across Europe, Asia, and Africa, often in prestigious venues with thousands of attendees. These events were designed to build excitement and attract more investors.
At the centre of these promotions was Ignatova, who often appeared on stage in glamorous attire, delivering inspiring speeches about OneCoin’s potential. Known as the “Cryptoqueen,” she compared OneCoin to Bitcoin and positioned it as a revolutionary tool that would change the financial world.
From success to suspicion
By late 2016, OneCoin had become a global phenomenon. The company claimed to have millions of members and billions in revenue. However, behind this impressive facade, cracks were beginning to show. Regulators in several countries started to investigate OneCoin’s activities, raising questions about its legitimacy. While the company continued to grow, these investigations set the stage for its eventual collapse.
How OneCoin worked?
Centralised system
Unlike decentralised cryptocurrencies such as Bitcoin, OneCoin was entirely controlled by its creators. Investors bought educational packages that came with tokens, which they could use to “mine” OneCoins. These packages ranged from entry-level options costing a few hundred euros to more expensive packages priced at thousands of euros.
However, the concept of “mining” was an illusion. In legitimate cryptocurrencies, mining involves solving complex mathematical problems to validate transactions on a blockchain. OneCoin, on the other hand, had no real blockchain. The company issued tokens at will and manipulated their price to create the appearance of growth.
Manipulated value and internal exchange
The value of OneCoin was not determined by supply and demand but was artificially set by the company. Initially priced at €0.50 per coin, its value steadily increased to nearly €30 per coin. This price manipulation helped maintain the illusion of a thriving cryptocurrency.
OneCoin also operated an internal exchange where members could trade their tokens. However, access to the exchange was limited, and the company shut it down entirely in 2016. This left investors with no way to convert their tokens into real currency, effectively locking their funds within the OneCoin system.
Fake mining claims
One of the most deceptive aspects of OneCoin was its claim that it was mined like other cryptocurrencies. Internal emails later revealed that the company’s leaders called the tokens “fake coins.” They openly discussed how to manipulate exchange rates and create the illusion of a thriving cryptocurrency market.
Main figures and roles of OneCoin
Ruja ignatova – the “cryptoqueen”
Ruja Ignatova was the public face of OneCoin. With a background in finance and law, she portrayed herself as a visionary leader who understood the complexities of cryptocurrency. At promotional events, Ignatova captivated audiences with her speeches, painting a picture of a future where OneCoin would replace Bitcoin.
Her charismatic personality and polished public image helped build trust among investors. Ignatova presented herself as someone who had the expertise and connections to make OneCoin a global success. However, behind the scenes, she orchestrated one of the largest financial frauds in history.
Karl Sebastian greenwood
Greenwood served as the co-founder and global distributor of OneCoin’s MLM network. He played a crucial role in expanding the scheme, ensuring new members joined continuously. Greenwood promoted OneCoin at events and online, making it appear like a legitimate investment opportunity.
Internal communications later revealed Greenwood’s true intentions. He referred to OneCoin investors as “idiots” and openly discussed manipulating the system to maximise profits. Greenwood was eventually arrested and sentenced to 20 years in prison for his role in the fraud.
Other key associates
Several other figures were involved in promoting OneCoin. Some helped expand its reach globally, while others managed the company’s finances. Many of these individuals later faced legal charges for their involvement in the scheme.
Major events and investigations
Timeline of events
OneCoin’s story is marked by several significant events highlighting its meteoric rise and ultimate downfall. The company launched in 2014; by 2015, it had millions of investors worldwide. Financial regulators raised early concerns, who began questioning OneCoin’s legitimacy. Countries such as Bulgaria, Germany, and India issued warnings about its operations.
The turning point came in 2016 when OneCoin’s internal exchange was shut down without warning. This caused panic among investors who could no longer trade their OneCoins. In October 2017, Ruja Ignatova boarded a flight to Athens, Greece, and disappeared without a trace.
Law enforcement involvement
Following Ignatova’s disappearance, several countries launched investigations into OneCoin’s activities. The United States led the charge, filing fraud and money laundering charges against Ignatova and other key figures. In 2022, the FBI added Ignatova to its Top Ten Most Wanted List, offering a $5 million reward for information leading to her arrest.
Karl Sebastian Greenwood was arrested in Thailand in 2018 and extradited to the United States. He pleaded guilty to wire fraud and money laundering and was later sentenced to 20 years in prison. Efforts to locate Ignatova continue, with authorities believing she may be hiding under an assumed identity.
Global asset freeze and legal updates
The freezing order
In August 2024, London’s High Court issued a global freezing order targeting Ruja Ignatova and several associates. This order was a significant milestone in the ongoing legal battle to recover stolen funds. It effectively prevented assets linked to Ignatova and others from being sold or moved.
The action was part of a group claim brought by over 400 OneCoin investors seeking compensation for their losses. Many of these investors had lost their life savings and were determined to hold those responsible accountable.
Individuals and companies affected
The freezing order targeted multiple individuals and companies connected to OneCoin. Among them were British businessmen Christopher Hamilton and Robert MacDonald, who were accused of laundering OneCoin proceeds. Two Guernsey-based companies used to purchase luxury properties for Ignatova were also included in the freeze.
The properties in question included a £13.5 million Kensington penthouse and a £1.9 million apartment for her bodyguards. Several OneCoin promoters were also affected, some of whom had significantly profited from recruiting new investors.
Despite the freezing order, much of the stolen money remains untraceable. Legal battles are ongoing as lawyers argue over who bears responsibility for the scheme and how victims can be compensated.
Impact on victims
Financial losses
The OneCoin scam left a devastating trail of financial losses. Many victims were ordinary people who believed they were investing in a legitimate cryptocurrency. Jennifer McAdam, one of the leading voices for OneCoin victims, lost over £200,000, along with her friends and family. Her story is one of countless examples of people who were misled and left in financial ruin.
In the UK alone, investors lost over £100 million. The scheme attracted people from diverse backgrounds, including small business owners, retirees, and professionals. Some victims invested their life savings, expecting life-changing returns, only to be left with nothing.
Emotional toll
The emotional impact of the OneCoin scam was equally severe. Victims faced immense stress, broken relationships, and shattered trust. Many felt ashamed and blamed themselves for falling for the scam. For some, the financial losses were so significant that they struggled to rebuild their lives.
Efforts to recover lost funds continue, but the road to justice remains difficult. Group actions like the one at London’s High Court offer a glimmer of hope, but compensation is far from guaranteed. The OneCoin case is a stark reminder of the risks associated with unregulated investments.
Current status of OneCoin and Ruja Ignatova
Company collapse
OneCoin is no longer operational. Its reputation was irreparably damaged following the exposure of its fraudulent activities. Regulatory authorities shut down its operations, and many of its leaders were arrested or faced legal charges. The company’s collapse left millions of investors without any recourse, as their tokens had no real value.
Despite the company’s end, the OneCoin saga is far from over. Legal proceedings continue in multiple countries, with victims fighting for justice and compensation. The case remains one of the most infamous examples of financial fraud in modern history.
Search for Ignatova
Ruja Ignatova’s disappearance is one of the most intriguing aspects of the OneCoin story. After vanishing in 2017, she has managed to evade capture for years. Various theories suggest she may be living under a new identity, possibly with the help of organised crime networks.
The FBI continues to search for Ignatova, offering a $5 million reward for information leading to her arrest. Despite numerous reported sightings, her whereabouts remain a mystery. Some believe she may have undergone extensive surgery to change her appearance, while others speculate she may no longer be alive.
Lessons and warnings
Recognising fraud
The OneCoin case offers important lessons for investors. One of the key red flags was the lack of a transparent and verifiable blockchain. Legitimate cryptocurrencies rely on public ledgers that can be independently verified. OneCoin’s centralised control and inability to prove its blockchain were major warning signs.
Another red flag was the promise of guaranteed returns. In any investment, high returns come with high risks. OneCoin’s steady price increase and unrealistic growth rates should have raised suspicions among investors.
Importance of due diligence
Before investing in any project, it’s crucial to conduct thorough research. Verifying the legitimacy of a project, reading independent reviews, and seeking professional advice can help reduce the risk of falling for scams. Being wary of aggressive recruitment tactics and high-pressure sales strategies is also essential.
Role of financial education
Financial education plays a critical role in helping individuals make informed decisions. Understanding the basics of cryptocurrency, investment strategies, and the risks involved can help people protect themselves from fraud. As technology evolves, so do the methods used by fraudsters, making continuous learning and awareness vital.
FAQs
Has Ruja Ignatova ever been found?
Ruja Ignatova, the Bulgarian founder of OneCoin known as the “Cryptoqueen,” has not been seen since she vanished in 2017.
What are the biggest crypto Ponzi schemes?
Apart from OneCoin, other major crypto scams include Bitconnect ($3.5 billion lost), PlusToken ($3 billion), GainBitcoin ($300 million), and Mining Max ($250 million).
How much is one Bitcoin worth?
Bitcoin’s value fluctuates frequently. As of September 2023, it traded at $26,551, ranging between $26,000 and $67,500 over the past two years.
How did OneCoin promise returns?
OneCoin lured investors by promising steady token value growth and large profits through educational packages and token mining.
Who was Karl Sebastian Greenwood?
Greenwood co-founded OneCoin with Ignatova, managing its MLM network. He was arrested in 2018 and sentenced to 20 years for his role in the fraud.
