Karl Sebastian Greenwood, a co-founder of the infamous OneCoin cryptocurrency scam, has been sentenced to 20 years in a U.S. prison. Alongside the prison term, Greenwood also faces a substantial fine of $300 million.
On September 12, a judge handed down the lengthy prison sentence to Greenwood, a key player in orchestrating the colossal OneCoin scam. This fraudulent scheme duped investors worldwide, siphoning more than $4 billion from unsuspecting victims. The case has brought to light one of the most significant cryptocurrency frauds in history, shedding light on the depth of deception and audacity employed by Greenwood and his associates.
Karl Sebastian Greenwood deceptively marketed OneCoin as a credible alternative to Bitcoin, a façade that quickly unravelled under scrutiny. His strategy involved constructing a complex pyramid scheme that offered financial rewards to new recruits, all while being fully aware that OneCoin had no intrinsic value or legitimacy.
The United States Attorney for the Southern District of New York revealed that Greenwood incentivized members to recruit new victims, amassing over $200 million in commissions within two years. This scheme exploited the trust of unsuspecting individuals who believed they were entering the next frontier of cryptocurrency.
OneCoin’s Lack of Legitimacy
OneCoin needed the essential elements of a legitimate cryptocurrency. It had no blockchain, conducted no mining operations, and arbitrarily assigned fictitious valuations that purportedly increased over time. Despite these glaring red flags, investors were deceived into believing that OneCoin could rival Bitcoin, a baseless notion.
Official records confirm that OneCoin amassed an astounding €4.037 billion in sales revenue and recorded €2.735 billion in profits between the 4th quarter of 2014 and 2016. This vast financial deception ensnared more than 3.5 million victims worldwide, solidifying its position as one of history’s most substantial fraudulent schemes.
While countless investors suffered losses, Karl Sebastian Greenwood enjoyed a lavish lifestyle funded by ill-gotten gains. He spared no expense, indulging in designer clothing, extravagant timepieces, overseas real estate holdings, and even a down payment for a luxury yacht. His extravagances extended to luxurious first-class travel on a private OneCoin jet, stays at five-star resorts, and the rental of beachfront villas in picturesque destinations.
After being apprehended and facing charges from law enforcement, Greenwood pleaded guilty to wire fraud and money laundering in December 2022.
A key figure in the OneCoin saga, Ruja Ignatova, known as the “Cryptoqueen,” remains at large. She vanished in 2017 after being indicted in the U.S. on fraud and money laundering charges. Ignatova played a central role as the public face of OneCoin, organizing flashy marketing events and fueling hype while fully aware of the fraudulent nature of the operation.
Earlier this year, rumours circulated that Ignatova may have met her demise in Greece five years ago.
