More than a decade after the OneCoin scam began, victims of the $4 billion cryptocurrency fraud scheme are now eligible for compensation from a $40 million fund of seized assets, as announced by the US Department of Justice. Between 2014 and 2019, OneCoin's co-founders, Ignatova and Karl Sebastian Greenwood, orchestrated a global cryptocurrency investment scheme that deceived up to 3.4 million investors worldwide.
The scheme, which was operated from Sofia, Bulgaria, involved the sale of a fraudulent cryptocurrency through a multi-level marketing network. Investors globally lost over $4 billion to the scam, which did not actually involve any cryptocurrencies and was not listed on any blockchain. The scheme collapsed in 2017 after it was discovered that Ignatova and her team had artificially inflated the value of OneCoin by generating new coins.
In 2022, Greenwood pleaded guilty to federal wire fraud and money laundering charges, and in June 2024, the DOJ offered a $5 million reward for information leading to the capture of the missing 'Cryptqueen'. According to US Attorney Jay Clayton, the founders of OneCoin 'sold a lie disguised as cryptocurrency', resulting in losses of over $4 billion worldwide. The DOJ has stated that it will continue to seize criminal proceeds and prioritize reimbursing victims. This development comes roughly four weeks after the FTX Recovery Trust announced plans to distribute $2.2 billion to creditors, as part of a broader effort to recover assets for users of the crypto trading platform, which collapsed in November 2022.