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Legal cases in the world of cryptocurrency continue to unfold. Karl Sebastian Greenwood, a pioneer and marketer in the crypto exchange industry, has been sentenced to 4 years in prison for his role in the $20 billion OneCoin scam.
Greenwood Defrauded Investors in the Crypto Scheme
Between 2014 and 2016, Greenwood was a co-founder of the fake cryptocurrency OneCoin, which generated €4 billion ($4.3 billion) in revenue and €2.7 billion ($2.93 billion) in profits. When the scheme eventually unraveled, it was considered the largest and first cryptocurrency-related fraud in history. Approximately 3.5 million people worldwide were affected by this illegal operation.
OneCoin operated as a multi-level marketing scheme that rewarded individuals for recruiting others into the system. Greenwood worked alongside Ruja Ignatova, also known as the “Cryptoqueen,” who is currently one of the most wanted criminals on the United States Federal Bureau of Investigation’s list. Both Greenwood and Ignatova promoted OneCoin as the next Bitcoin (BTC) within the crypto ecosystem, while Greenwood was also a key supporter of the pyramid scheme.
Profits from the OneCoin Fraud
According to prosecutors, Greenwood profited approximately $300 million from this fraudulent scheme. He used a significant portion of these profits to purchase properties in Spain, Dubai, and Thailand. He also embarked on luxury trips using a private OneCoin jet, bought designer clothes, and made a down payment for a Sunseeker yacht.
United States District Judge Edgardo Ramos stated that the fraud was massive in every aspect. He highlighted some flaws in the crypto plan, which served as a red flag. First and foremost, he emphasized that OneCoin’s blockchain did not have a real cryptocurrency or trading market. Victims were unable to withdraw their investments or recover their money.
On the other hand, Ignatova, the “Cryptoqueen,” is still missing, although reports emerged earlier this year that she was seen in the heart of London. She is currently the only woman on the FBI’s Most Wanted list and has been added to the Top 10 Most Wanted Fugitives list. A reward of $250,000 has been offered for information leading to her whereabouts.
