I heard of Onecoin in 2016 from a fellow who was narrating how big an investment they invested in. Even though I didn’t pay much attention then since I had no interest in cryptocurrencies, I did know it sounded too good to be true. Investments with outsized profits always are too good to be true.
It is always amazing how big scams make it to public consciousness. Onecoin has since won the record of becoming the biggest scam in the crypto world. In June 2016, a crypto investor and businesswoman, Ruja Ignatova introduced her investment, Onecoin to world at a conference in Wimbledon. The woman who would later be known as the Crypto Queen exhibited a charisma that charmed her audience as she made presentation after presentation in various countries.
Ruga affirmed that her new cryptocurrency would revolutionize the crypto sphere and financial market by beating the premier cryptocurrency, Bitcoin. Many believed her and invested billions of dollars. The idea of making payments from anywhere in the world with accumulated wealth was irresistible to many.
Despite her aura and the confidence with which she presented her wonder coin, a year later, Ruga disappeared with the billions she made from investors leaving them with a worthless coin, in a scheme that has continued to marvel investigators. Two years after, no one has an idea where the crypto queen is and what could have happened to all that money.
The scam was a worldwide phenomenon as Ruga and her team made presentations in countries ripping people off billions. The 36 year old Bulgarian was always lavishly dressed during these presentations to keep no one in doubt that she called shots as far as Onecoin, the Bitcoin Killer was concerned. People of various countries from Pakistan to Argentina, Australia to Canada lost money in the worldwide scheme that reportedly grossed more than $5 billion.
One fact that people have failed to understand is that money is valuable to the extent that people believe that it is valuable. Whether the USD or CAD, rouble or yen, what counts is the value people place on it. However, the control of issuance of money in the hands of the wrong person could spell disaster for the economy or people who trust it. Throughout history, people have used different items such as gold, salt and even shells as money. People considered these valuable because they were confident that it wouldn’t be manipulated.
This is exactly what Bitcoin is, a digital currency that could not be manipulated because there are so many people all over the word with copies of the blockchain, the technology on which Bitcoin works. The blockchain is like a big book that updates automatically whenever someone makes a bitcoin transaction from their wallet to another. The coin effectively solves the problem of spending the same bitcoins twice.
This is the idea that Ruja Ignatova used to deceive so many. However, like the investor of Bitcoin, Nakamoto Satoshi, she disappeared but with a large chunk of her own cryptocurrency, Onecoin.
The MLM Connection
What investigators have found about the Onecoin scam is that Ruja had recruited top network marketers to promote her cryptocurrency. One of these marketers, Igor Alberts and his wife Andreea Cimbala switched over to promoting OneCoin after attending one of the conferences in Dubai in 2015 in which Ruja presented her ‘revolutionary cryptocurrency’. According to a BBC report, Igor would make millions of pound from Onecoin before Ruja disapperared.
Problem started for Onecoin when the managers approached a blockchain expert, BjornBjercke and asked him to build them a blockchain. When he realized that the company that offered him massive financial rewards for the job was Onecoin, he didn’t accept the job.
By December 2017, Ruja had gone underground on a day she was expected to make a presentation in Lisbon, Portugal. FBI records show that her last known location was Athens, Greece before she went completely off radar. Her brother, Konstantin Ignatov who took over the OneCoin pyramid scheme was later arrested and charged with fraud by the FBI.
The Onecoin scheme succeeded in stealing from so many people because of the lure for quick riches and the fact that the participants were made to believe that they’re a part of something revolutionary. Genuine investments have always been considered slow yield by many. This mindset is a contributory factor that cannot be overlooked as well. The absence of regulation for cryptocurrency is another reason why Oncoin is still operating despite being the biggest cryptocurrency scam the world has witnessed.