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OneCoin, the story of the “Bitcoin killer”
OneCoin, the story of the “Bitcoin killer”
Crypto

OneCoin, the story of the “Bitcoin killer”

By Eleonora Spagnolo - 18 Jul 2020

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OneCoin was supposed to be the Bitcoin killer, until the judicial authorities across the world called it a scam. Indeed, by some it is considered the scam of the century, able to raise 4 billion euros. 

Among accomplishments, disappearances and even crimes, this is the story of the cryptocurrency that promised a financial revolution. 

OneCoin, the Bitcoin Killer

OneCoin was born in 2015. The founder of this currency is Ruja Ignatova, CEO of the eponymous company based in Bulgaria. The aim of OneCoin was to create an electronic currency, an alternative to cash and above all an alternative to Bitcoin.

At a time when Bitcoin was already quite well known, OneCoin began to structure itself not as an actual cryptocurrency, but as a “future” cryptocurrency. OneCoin was advertised by real multi-level marketing promoters. Investors were buying “token” packages that would be converted into OneCoin in the future when the currency would finally go live. 

The company actually always claimed that they were selling educational packages. These packages were of various amounts and each one guaranteed very advantageous returns. 

Taking as an example what the Italian AGCM reports in a 2017 investigation, the packages on sale ranged from an investment of 140 euros up to the largest one of 27,530 euros. The first one promised a return of 2,800 euros in 2018. In the case of the largest investment, the guaranteed return was €3 million. 

Despite the fact that there was no blockchain, despite the fact that the mining system was not clear, despite the fact that OneCoin professed to be Bitcoin’s heir, despite the fact that it did not have a similar technical infrastructure, despite the fact that it was not even clear why OneCoin’s value should rise so much that it guaranteed returns of €3 million, the purchases of the packages proliferated.

OneCoin established a real community, with engaging and spectacular events. The most famous of these is still the one held in London at Wembley Arena, in the presence of Ruja Ignatova. It was July 11th, 2016. 

On stage, Ruja Ignatova promised an easy-to-use cryptocurrency, for everyone, that would become the most used in the world. She said that behind OneCoin was not just a vision, but a family.

“In the last 2 years I’ve been called a lot of things, and probably the best thing that the press called me was: ‘OneCoin, who is supposed to be Bitcoin killer’. Well, I must say I like it”.

This is what Ruja used to say to the frantic public. Deluded that they were a family and that they would easily become rich, there were many who wanted to join the “financial revolution”

The explosive growth of OneCoin, combined with the failed and always postponed launch of the cryptocurrency, drew the attention of the authorities. Because in reality, the only way to get rich with OneCoin was to sell packages to other people and recruit new investors. 

The regulatory authorities quickly set their eyes on this scheme. The crucial year was 2017, when the German BaFin forced OneCoin’s activities to cease because OneCoin and OneLife did not have adequate licenses to trade financial instruments. Already before that, the Belgian authority warned the public about the risks of investing in OneCoin. The same warning was also issued by the British FCA. 

Even the Italian Competition Authority fined OneCoin and OneLife for unfair practices

Nevertheless, OneCoin continued to raise money and worship the company’s creator, Ruja Ignatova. Who disappeared on a mysterious day in October 2017.

Ruja Ignatova

Dr Ruja is the mastermind behind OneCoin. Charming, charismatic, cultured, she’s the star of this story. In her appearances, she is always extremely well-groomed, with the ever-present red lipstick. A graduate in private law, she claimed to have studied at Oxford. 

Her tracks were lost in October 2017. Expected at a OneCoin event in Lisbon, Ruja never showed up. 

There are many theories about her disappearance. The first hypothesis is that she was kidnapped because her project promised to crush traditional finance. The second hypothesis is that she disappeared because she wanted to disappear. According to some people, OneCoin was too big to handle by then. 

A reconstruction of Ruja Ignatova’s life, business and disappearance can be found in the BBC documentary The Missing CryptoQueen. In this podcast, it is assumed that Ruja has completely changed her appearance with cosmetic surgery. And that she would be in Germany.

The arrest of Konstantin Ignatov

With Ruja Ignatova’s disappearance, OneCoin’s activity hadn’t stopped. Her brother and former bodyguard Konstantin Ignatova took over. But on March 6th, 2019 he was arrested at Los Angeles airport, where he was about to board a flight to Bulgaria after a OneCoin event. 

Accused of fraud, he faces up to 20 years in prison. The sentence is still pending. 

With his arrest, OneCoin’s story actually comes to a standstill. After the fines, the operating ban, the confiscations, the closed websites, and the title of scam of the century, OneCoin has probably finished deluding its investors. There will be no financial revolution, to the detriment of those who believed in it

OneCoin has failed to kill Bitcoin, which instead continues its slow path towards mass adoption. 

This story confirms one thing: always be wary of those who promise easy profits with the minimum investment. And always examine the investments before committing any money, or even worse, life savings. 

 

Eleonora Spagnolo
Eleonora Spagnolo

Journalist passionate about the web and the digital world. She graduated with honours in Multimedia Publishing at the University La Sapienza in Rome and completed a master's degree in Web and Social Media Marketing.

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