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OneCoin is predicted to have scammed more than $4bn, while co-founder Ruja Ignatova remains a fugitive to this day.
Karl Sebastian Greenwood, the co-founder of the notorious OneCoin cryptocurrency scam, has been sentenced to 20 years in prison and a $300m fine.
OneCoin was a Bulgarian-based cryptocurrency that launched in 2014, attracting a lot of crypto investors. The US attorney’s office for the southern district of New York claims millions of victims invested more than $4bn into the cryptocurrency, which was eventually shown to be fraudulent.
The US office said this cryptocurrency had “no actual value” and was designed to be a fraud scheme “from day one”. Greenwood co-founded OneCoin with Ruja Ignatova who is known as the ‘Cryptoqueen’.
Greenwood was arrested in Thailand and extradited to the US in 2018, to face fraud and money-laundering charges which he has pleaded guilty to. US attorney Damian Williams said Greenwood was behind “one of the largest fraud schemes ever perpetrated”.
“Greenwood and his co-conspirators, including fugitive Ruja Ignatova, conned unsuspecting victims out of billions of dollars with promises of a ‘financial revolution’ and claims that OneCoin would be the ‘Bitcoin killer’,” Williams said.
“In fact, OneCoins were entirely worthless, and investors were left with nothing, while Greenwood lined his own pockets with over $300m. We hope this lengthy sentence resonates in the financial sector and deters anyone who may be tempted to lie to investors and exploit the cryptocurrency ecosystem through fraud.”
Ignatova remains a fugitive to this day and was added to the FBI’s Top Ten Most Wanted List in June 2022. The FBI is also offering a $100,000 reward for any information that leads to her arrest.
While this is a massive example, scams in the cryptocurrency space have been a threat for years. Sam Bankman-Fried, the founder of collapsed crypto exchange FTX, is currently facing fraud charges for allegedly stealing billions of customer funds for his trading firm Alameda Research.
Last year, Kim Kardashian was fined $1.26m for promoting a cryptocurrency on Instagram without revealing she had been paid to do so.
The price of EthereumMax – the cryptocurrency she advertised – fell by 50pc one week after Kardashian promoted it on Instagram, which led to some accusing the crypto of being a “pump and dump” scheme. A class-action lawsuit into EthereumMax and various celebrities is still ongoing.
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