Cryptocurrency scams are really not new news at all, but they’re not as huge as this very one. The United State law agancy has arrested Konstantin Ignatov over a fraud charge relating to OneCoin, the cryptocurrency he co found.
Konstantin Ignatov was charged along with his sister Ruja Ignatova though she’s hiding, and there were others who were allegedly orchestrated a “multibillion-dollar pyramid scheme” where people get commissions for persuading others to buy OneCoin packages that themselves were junk.
It was noticed that OneCoin rigged prices and sold people coins that never existed and didn’t have a true blockchain to manage the currency.
According to the US Justice Department, OneCoin is on and running, and has been very lucrative so far. The company made €2.2 billion ($2.5 billion) profit between 2014 and 2016.
A third defendant has already been charged in the scheme, Mark Scott, was said to have laundered over $400 million through banks in places like the Cayman Islands and Ireland.
Flowing the charges, all of the offenders could face major penalties if they’re found guilty as charged. Konstantin Ignatov’s charge as the major culprit could lead to 20 years in jail, since he has four charges and each charge carries five years. Scott will also be facing up to 20 years in jail too.
The arrest shows the present challenge cryptocurrency is facing since the technology is still very much young and the promoters aren’t so sure of how to regulate it against the activities of fraud-stars, hence the need to proffer a better policing scheme to protect the activities around it.