A $40 million fund has been established from seized assets to compensate victims of the $4 billion OneCoin cryptocurrency scam, as announced by the US Department of Justice. The scheme, which operated between 2014 and 2019, involved co-founders Ruja Ignatova and Karl Sebastian Greenwood deceiving up to 3.4 million investors worldwide through a global multi-level marketing network. The fraudulent cryptocurrency was marketed and sold, but did not actually exist on any blockchain.
After the scheme collapsed in 2017, the DOJ has been working to seize assets and compensate victims. In a statement, US Attorney Jay Clayton said the founders 'sold a lie disguised as cryptocurrency', resulting in losses of over $4 billion. The DOJ will continue to prioritize seizing criminal proceeds and returning funds to victims. This development comes as the FTX Recovery Trust has also announced plans to distribute $2.2 billion to creditors, as part of a larger effort to recover assets for users of the collapsed cryptocurrency trading platform.