More than a decade after the OneCoin scam began, victims of the $4 billion cryptocurrency fraud scheme can now apply for compensation from a $40 million fund of seized assets, as announced by the US Department of Justice. The scheme, which operated between 2014 and 2019, involved co-founders Ignatova and Karl Sebastian Greenwood, who defrauded up to 3.4 million investors worldwide through a global multi-level-marketing network. The fraudulent cryptocurrency, marketed and sold by OneCoin Ltd., did not actually exist on any blockchain and did not involve real cryptocurrencies, despite promoters soliciting investments in exchange for purported tokens. The scheme, described by the DOJ as 'one of the largest global fraud schemes in history', collapsed in 2017 after Ignatova and her team were found to have artificially inflated OneCoin's value.
In 2022, Greenwood admitted to federal wire fraud and money laundering charges, and in June 2024, the DOJ offered a $5 million reward for the missing 'Cryptqueen'. According to US Attorney Jay Clayton for the Southern District of New York, 'OneCoin's founders sold a lie disguised as cryptocurrency, costing victims over $4 billion worldwide'. The DOJ has pledged to continue seizing criminal proceeds and prioritizing the return of funds to victims. This development comes approximately four weeks after the FTX Recovery Trust announced its 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.