A $40 million fund, comprising seized assets, has been established by the US Department of Justice to compensate victims of the $4 billion OneCoin cryptocurrency scam, which was uncovered between 2014 and 2019. The scheme's masterminds, including Ignatova and Karl Sebastian Greenwood, deceived up to 3.4 million investors worldwide through a multi-level marketing network.
The global operation sold a fake cryptocurrency, accumulating over $4 billion in investments, despite lacking any actual connection to blockchain technology. After the scheme's collapse in 2017, the DOJ has been working to hold those responsible accountable, with Greenwood admitting to federal wire fraud and money laundering charges in 2022.
US Attorney Jay Clayton stated that the founders 'sold a lie disguised as cryptocurrency,' resulting in losses exceeding $4 billion globally. The DOJ will continue to prioritize seizing criminal proceeds and returning funds to the victims. This development follows the FTX Recovery Trust's announcement to distribute $2.2 billion to creditors, as part of its Chapter 11 plan, marking a significant step towards recovering assets for users of the defunct crypto trading platform.