A co-founder of the fraudulent cryptocurrency OneCoin, touted as a “Bitcoin killer,” pleaded guilty to money laundering and wire fraud charges in a New York City federal court on Friday, while the other founder remains missing and is listed among the FBI’s most wanted.
OneCoin operated as a multi-level marketing (MLM) network where members made commissions by getting other people to purchase the company’s packages.
Due to the MLM structure, OneCoin rapidly grew in just a few years. According to records, OneCoin generated over 4 billion euros ($4.2 billion) in revenue and 2.7 billion euros ($2.9 billion) in profits between the fourth quarter of 2014 and the fourth quarter of 2016. The company’s promotional materials claim that over 3 million people invested in the program.
“Greenwood’s lies were designed with one goal, to get everyday people all over the world to part with their hard-earned money—real money—and to line his own pockets to the tune of hundreds of millions of dollars,” Damian Williams, U.S. Attorney for the Southern District of New York (SDNY), said in a statement.
Defrauding Investors
Greenwood and Ignatova allegedly set up OneCoin to cheat investors out of their money, according to documents submitted by prosecutors. In an email exchange between the two on Aug. 9, 2014, Ignatova described the first “exit strategy” for OneCoin as “Take the money and run and blame someone else for this.”OneCoin falsely claimed that the value of the cryptocurrency was based on market demand and supply. Instead, the value of the coin was strictly set by the firm itself.
In a June 9, 2014, email to another company, Ignatova copied Greenwood onto the email and wrote that “we are building our own cryptocurrency—and would like to set up an internal exchange service for them. We would like to be able to set the price manually and automatically and also control the traded volume.”
In a March 21, 2015, email to Greenwood, Ignatova said that “we can manipulate the exchange by simulating some volatility and intraday pricing.”
Arrest and Potential Punishment
Greenwood was arrested from his residence in Thailand in July 2018. He was extradited to the United States in October 2018 and has remained in detention since his arrest.Greenwood, who is a citizen of the United Kingdom and Sweden, pleaded guilty to one count of conspiracy to commit wire fraud, one count of wire fraud, and one count of conspiracy to commit money laundering, each of which comes with a maximum prison term of 20 years. Sentencing on his case is scheduled for April 2023.
Meanwhile, Ignatova, who is now known as the “cryptoqueen,” was added to the FBI’s Top 10 Most Wanted list in June 2022.
“Ignatova is believed to travel with armed guards and/or associates. Ignatova may have had plastic surgery or otherwise altered her appearance.”
