A recent class action decision against OneCoin was dismissed by Konstantin Ignatov, the co-founder of OneCoin, as a defendant after he agreed to testify against his sister. Ignatov is the brother of Ruja Ignatova, the infamous leader and face of OneCoin, also known as “Cryptoqueen”. Ignatova disappeared in 2017 and has since managed to get away from the authorities and the public.
Although Ignatov was suspended from the lawsuit initiated by the defrauded OneCoin investors, court documents show that the same case will continue against Ignatova. The brothers are still charged with another US Department of Justice lawsuit that could face up to 90 years in prison.
Ignatov, arrested on March 6, 2019 in Los Angeles, spoke frankly with his sister and stated that she had not been in contact with her since her disappearance, and that she used a private detective to find her, but without much success. … On Yavin, the founder and CEO of Cointelligence, a data and education source about blockchain, told Cointelegraph:
“OneCoin investors hoped that by pursuing Ignatov, who was already in custody, they would have some opportunity to get at least some of their money back. But their choice to refer the case now, after a court warned them not to provide enough details, suggests that they may have been reckless. I do not think. This decision in no way means that Ignatov is innocent, and I do not think that investors are ready to give up.
With Ignatov excluded from the indictment in the lawsuit against OneCoin and Ignatova still on the run, many are now wondering how OneCoin managed to trick so many people and what the victims can do. The sad story of OneCoin became so popular that it inspired a new TV show.
OneCoin’s history is full of red flags. Founded in 2014, the Bulgarian company has followed the typical structure of a multi-level marketing plan, but with evolution. There were no groceries or organic foods for walking; Instead, it was a cryptocurrency that OneCoin regulators billed as the next bitcoin (BTC).
Many people inside and outside the cryptocurrency community have watched this scam. Those familiar with the MLM model quickly saw the similarities in operations and marketing, and those familiar with cryptocurrencies could clearly see the absence of a blockchain or network. The OneCoin cryptocurrency was nothing more than imagination. Disclosures of the million dollar pyramid scheme have also been published in several outlets, including Cointelegraph, which reported it in 2015. Several institutions and government agencies were quick to warn about OneCoin as well.
However, over the years the company has become very popular as membership packages, which supposedly contain OneCoin tokens, are sold out and offer the opportunity to earn more. It can be exchanged for fiat currency on the private exchange Xcoinx, but members can only sell a limited amount determined by the purchased membership package. This move allowed the Ponzi scheme to distribute funds over long periods of time, to some extent attracting investors. Yavin commented:
“They convinced their investors that all warnings come from the haters and they created a ‘we versus them’ mentality. Another reason OneCoin continues to work is that regulators are not doing enough, like the UK FCA is not doing enough to stop people selling OneCoin. And the last time I checked in a few months ago, it still happened! ”
OneCoin has been known for its tough and cool marketing tactics, such as offering extravagant products in which the charismatic face of OneCoin, Ignatova and other regulators told about the cryptocurrency to forgotten victims. Take the colorful Coin Rush scene at the SSE Arena in London, where Ignatova, in typical OneCoin fashion, called OneCoin a “bitcoin killer” and everyone who opposed her as a “hater”.
The pyramid begins to crumble
In the aforementioned incident, Ignatova stated that OneCoin will acquire a new and improved blockchain, and that OneCoin’s offer will be doubled, thereby doubling the share of participants. However, two weeks later, renowned bitcoin developer Bjorn Bjerke was contacted with an offer to become technically responsible for OneCoin and actually develop the blockchain, which he turned down. Controversies and empty promises have gathered in OneCoin’s arms, and by this time the alleged exchange had already closed for several months from March 2016.
After a lot of warnings and stories about the iconic Ponzi scheme, many investors are getting nervous, especially since the promises of the new exchange have not been fulfilled. However, the show continued until October 2017, when Ignatova disappeared and the OneCoin pyramid began to fall apart.