US Opens Compensation Claims for OneCoin Victims | Crypto Security News
Crypto security news: US Opens Compensation Claims for OneCoin Victims. This update explains what happened, why it matters for wallets, exchanges, traders, and users, and what the market should watch next.
Crypto Security Update
The US Department of Justice has launched a compensation process for victims of the $4 billion crypto Ponzi scheme OneCoin, using forfeited assets taken from some of the scheme’s architects.The Justice Department said on Monday that more than $40 million in forfeited assets is available to compensate anyone who purchased OneCoin between 2014 and 2019 and recorded a net loss.Jay Clayton, the US Attorney for Manhattan, said the compensation process was “an important step toward returning funds to those harmed.”OneCoin was launched in 2014 with the goal of surpassing Bitcoin (BTC), but later collapsed after users discovered the coins had no real blockchain or utility and authorities worldwide began investigating the operation.Before it collapsed, OneCoin rose to become the second-largest cryptocurrency by market capitalization. Source: YouTube “Between 2014 and 2019, OneCoin’s founders sold a lie disguised as cryptocurrency, costing victims more than $4 billion worldwide,” Clayton said. “While no recovery can fully undo the damage, our Office will continue working to seize criminal proceeds and prioritize getting money back into the hands of victims.”OneCoin co-founder disappeared, another got 20 yearsOneCoin was launched by Ruja Ignatova and Karl Sebastian Greenwood in Bulgaria and began operating in the United States around 2015.The Justice Department estimates that between 2014 and the end of 2016, the scheme stole more than $4 billion from around 3.5 million victims. However, some estimates for worldwide losses reach $19 billion.Related: Hacked crypto tokens drop 61% on average and rarely recover, Immunefi report saysPrior to OneCoin’s collapse, several central banks, including those of Latvia, Sweden and Norway, warned investors against the cryptocurrency, flagging it as a possible Ponzi scheme.Bulgarian police eventually raided OneCoin’s headquarters in 2018 and arrested Greenwood.He was sentenced to 20 years in prison in September 2023 for his role in the scheme. Ignatova was last seen in 2017, boarding a flight to Athens. She is one of the FBI’s “Ten Most Wanted Fugitives,” and the agency is offering $5 million for information leading to her capture and conviction.Magazine: Bitcoin quantum-safe without upgrade? CZ’s 2031 crypto vision: Hodler’s Digest, April 5 – 11Cointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently. Read our Editorial Policy https://cointelegraph.com/editorial-policy
Why This Security News Matters
First, this development may affect exchange safety, wallet security, user trust, and broader market sentiment. In addition, it may influence platform security practices, fund recovery efforts, and regulatory pressure. As a result, traders and crypto users should watch the next updates closely.
What To Watch Next
Watch for official statements, post-mortem reports, wallet warnings, exchange responses, and fund recovery updates. In particular, any new details about phishing, exploits, private key exposure, or security patches could directly affect the broader crypto market.
