onecoin-logoIn late 2014 OneCoin seemingly came out of nowhere.

Ruja Ignatova was an unknown outside of China and a select group of Europeans. Sebastian Greenwood was tied to the SiteTalk share-based Ponzi scheme.

As far as the cryptocurrency space went, the OneCoin concept was presented as being entirely new.

Turns out it isn’t.

OneCoin is little more than a third attempt at the Ponzi points model, tweaked for maximum financial destruction of its affiliate-base.

bigcoin-logoOur story begins in 2013 with BigCoin, a cryptocurrency you’ve never heard of.

BigCoin was launched by John Ng and based out of Hong Kong. It was marketed with the usual MLM cryptocurrency pitch, “we’re gunna be the next bitcoin!”

At some point Prosper Ltd (also known as Prosper Inc) got involved which attached Sebastian Greenwood, Ronnie Skold (also from SiteTalk), Ruja Ignatova and Nigel Allen (fresh from scamming people in Brilliant Carbon) to BigCoin.

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Prosper Ltd had its own fee structure within BigCoin, with downline members differentiated from the core BigCoin affiliate-base.

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Like OneCoin, the problem with BigCoin was you couldn’t do anything with it. Like all Ponzi points, it had no value outside of the scheme you invested in to acquire them.

This prompted Prosper LTD to come up with an unregistered securities share offering.

No doubt inspired by SiteTalk’s endless promises of a public offering, Ruja Ignatova herself delivered the news at a BigCoin event in July, 2014.

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Referred to as the “CryptoReal Investment Trust”, Ignatova explained

[0:51] The CryptoReal Investment Trust offers Propser members, who own tokens of BigCoin, to convert the tokens into shares of the CryptoReal Investment Trust.

[1:16] By taking the (BigCoin) tokens and converting them into shares, you convert your tokens from the virtual world into real assets.

The CryptoReal Investment Trust scheme launch was a disaster.

The internal value of BigCoin crashed and to this day CryptoReal Investment Trust shares remain “pending“.

By August 2014 BigCoin was on the verge of collapse, which prompted the company to create another cryptocurrency.

BNA was touted as the savior of BigCoin. Neither “currency” was open to the public, with trade restricted through BigCoin’s internal CoolsDAQ exchange.

Not surprisingly, BNA also crashed upon release.

After scamming who knows how much from a predominately Chinese affiliate-base, the BNA crash prompted the departure of core Prosper Ltd members.

Shortly thereafter, they began initiating plans to launch their own clone Ponzi points currency.

You know it today as OneCoin, run by the Prosper Ltd members who deflected from BigCoin.

The prototype concept following the split from BigCoin was referred to as Sabway (“sabway.biz”):

sabway-original-investment-packages

The Sabway website domain was privately registered on November 25th, 2014. Shortly after the initial prototype was revealed, it was modified to reflect the investment levels OneCoin would later launch with:

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By that stage the “Sabway” brand had been abandoned. Prosper Ltd staff were cloning the  OneCoin website onto the Sabway domain to tinker around with as needed.

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The rest is history.

OneCoin was launched as version 2.0 of the BigCoin cryptocurrency. In place of the CoolsDAQ exchange OneCoin implemented xCoinx.

BigCoin itself appears to have survived the Prosper Ltd exodus by relaunching as BigCoin Bao.

BigCoin Bao points are still tradeable on the internal CoolsDAQ exchange. The value appears to still be set by BigCoin themselves, however trading volume has tanked.

I suspect it’s only being kept alive to appease the few diehard Chinese investors who refuse to let go.

For all intents and purposes, OneCoin is a clone of BigCoin…

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…with one major exception.

The Prosper Ltd members running OneCoin (of which Ruja Ignatova is the only one publicly acknowledged), learnt the hard way that attempting to integrate Ponzi points outside of a Ponzi scheme inevitably results in a crash.

This is because outside of the Ponzi scheme the points are attached to, there is no demand. And with the value of the points artificially propped up by promises of riches to the Ponzi faithful, there never will be.

To (temporarily) address this, OneCoin came up with the concept of not going public until 80% of OneCoins had been generated by their script.

To put that into perspective, OneCoin has been generating points since late 2014. Last month they crossed the 30% point generation threshold.

80% of OneCoin points generated is years off… which gives the owners and top investors in the scheme plenty of time to fleece those who join after them.

One bump in the road was the announcement that upon 30% of points generated, OneCoin had hundreds of thousands of third-party merchants lined up and ready to accept OneCoin as a currency.

This is a copy of the idea behind BNA that BigCoin launched, which was also supposed to be spendable within a merchant network. Save for a few inhouse merchants created by BigCoin (think Coinvegas and OneCoin), the crash of BNA as they tried to go public meant merchant network integration never happened.

In order for merchants to accept Ponzi points, the points have to be released into the wild.

This means the creator of the points (OneCoin in this instance), are no longer able to arbitrarily set the value of the points.

Prosper Ltd know from their experience in BigCoin that releasing Ponzi points into the wild leads to a crash. Hence OneCoin have made no announcement about the promised merchants despite hitting 30% point generation weeks ago.

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As more and more investors question why the company isn’t delivering on the merchant promise, the other end of the OneCoin candle has been set alight by its ever-increasing value.

The Ponzi paradox of arbitrarily setting the value of points on the sole condition the new value can’t be lower than the current value, means withdrawals today exceed actual funds invested yesterday.

OneCoin don’t assign daily values to their points, so “today” and “yesterday” can be extrapolated accordingly.

The current situation sees OneCoin’s early investors (Prosper Ltd members and Chinese BigCoin affiliates), putting in withdrawal requests at a rate far greater than the funds they initially and re-invested  were valued.

This wouldn’t be a problem if genuine demand drove the price of OneCoin, but without it it’s up to OneCoin to honor withdrawal requests.

This classic symptom of a Ponzi collapse has been amalgamated into the excuse that there aren’t enough buyers on OneCoin’s xCoinx exchange to honor withdrawal requests.

What this really means is there aren’t funds in the kitty to pay everyone out. And so you have the current situation where 99.9% of OneCoin affiliate withdrawal requests are denied.

And that’s not going to change anytime soon, if only for the fact that OneCoin can’t payout funds it doesn’t have.

future-of-money-payments-onecoin-bigcoin-cloneWhereas everything about OneCoin up until now has been appropriated from Prosper Ltd member experiences in BigCoin, unfortunately BigCoin never got this big.

This is uncharted territory for OneCoin, hence the radio silence as they try to keep the ship afloat.

Unfortunately on top of everything else I’ve covered above, new icebergs have formed by way of a regulatory crackdown in OneCoin’s largest market.

Last month OneCoin was given the boot by their payment processor, China Union Pay. This means no more credit-card processing, with investors instead required to push money through less than reputable alternatives.

In a “mother of all ironies” turn of events, bitcoin has been introduced as a payment alternative. How apt that a Ponzi points faux cryptocurrency scheme find itself reliant on a legitimate cryptocurrency to survive – if for nothing else than the differences between the two that render one financial fraud and the other not.

Oh and Chinese authorities have also arrested local OneCoin investors. That and the ongoing police investigation into the scheme hasn’t gone down to well.

To date OneCoin has failed to address the investigation or arrest of their Chinese investors.

Instead they’ve swept them under the carpet, with a reschedule of their planned Chinese event to the offshore jurisdiction of Macau.

The hope is a recently released glitzy video promo will distract people long enough for OneCoin to work out its next move.

Again, this is another BigCoin playbook (I swear they even use the same stock drama music on some videos):

 

Update 3rd August 2021 – As at the time of this update several BigCoin promo videos have been marked private.

As such I’ve had to remove the previously accessible YouTube links. /end update

 

I don’t expect the revelation that OneCoin is basically a clone of a twice failed Ponzi will have much of an impact on existing OneCoin investors. As long as the company has their money, they’re screwed into complacent silence.

Some will bark denials and others, eager to scam whoever at whatever cost, simply don’t care.

What I hope though is this research has been an education in the formation of OneCoin. It’s atypical that a Ponzi scheme run by unknowns would just materialize to the extent OneCoin has.

Now you know it’s just the continuation of scamming from a group of veterans that have been at it for years.