A $40 million compensation fund has been established for victims of the $4 billion OneCoin cryptocurrency fraud, as announced by the US Department of Justice. The international scam, which ran from 2014 to 2019, involved co-founders Ignatova and Karl Sebastian Greenwood deceiving up to 3.4 million investors worldwide. The scheme, which was marketed as a cryptocurrency investment opportunity through a global multi-level marketing network, ultimately collapsed in 2017 after it was discovered that the perceived value of OneCoin was being manipulated.
The DOJ has described the scheme as 'one of the largest global fraud schemes in history.' In recent developments, the DOJ has offered a $5 million reward for information leading to the capture of the missing 'Cryptqueen' and has secured admissions of guilt from Greenwood for federal wire fraud and money laundering charges. 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 pledged to continue working to seize criminal proceeds and prioritize returning funds to the victims. This development comes on the heels of the FTX Recovery Trust's announcement to distribute $2.2 billion to creditors, as part of a broader effort to recover assets for users of the defunct crypto trading platform.