OneCoin leader Konstantin Ignatov asks Court for bail pending trial

Maria Nikolova

The defense counsel proposes release conditions including GPS location monitoring and $10 million in cash and properties securing a $20 million personal recognizance bond.

Konstantin Ignatov, the leader of ill-famed cryptocurrency scheme OneCoin, who stands accused of conspiracy to commit wire fraud, is asking for bail pending trial. The relevant documents were docketed on June 18, 2019.

The request was made in a Letter to Judge Edgardo Ramos of the New York Southern District Court.

The defense counsel proposes release conditions including GPS location monitoring of Ignatov and $10 million in cash and properties securing a $20 million personal recognizance bond. Further, the defendant will pay for 24-hour armed guards to ensure that he does not flee. Only pre-authorized individuals would be permitted inside his residence. Ignatov agrees not to use cellphones, nor a computer, apart for purposes of reviewing discovery and note taking.

There will be no involvement with anybody at OneCoin as a part of the proposed release conditions.

Let’s recall that Konstantin Ignatov has entered a plea of “not guilty” to Count 1 – conspiracy to commit wire fraud.

According to the allegations contained in the Complaint, starting in late 2017, Ignatov, assumed high-level positions at OneCoin, rising to the top leadership position by mid-2018.

OneCoin Ltd. is said to be operating as a multi-level marketing network through which members receive commissions for recruiting others to purchase cryptocurrency packages. This multi-level marketing structure appears to have influenced rapid growth of the OneCoin member network. Indeed, OneCoin Ltd. has claimed to have more than 3 million members worldwide, including victims living and/or working within the Southern District of New York.

Among a number of other representations, OneCoin Ltd. has claimed that the OneCoin cryptocurrency is “mined” using mining servers maintained and operated by the company, and that the value of OneCoin is based on market supply and demand. In fact, the value of OneCoin is determined internally and not based on market supply and demand; and OneCoins are not mined using computer resources.

Additionally, OneCoin Ltd. has claimed to have a private “blockchain,” or a digital ledger identifying OneCoins and recording historical transactions. The investigation has revealed that OneCoin lacks a true blockchain, that is, a public and verifiable blockchain.

Furthermore, Ignatov has repeatedly represented that an “initial public offering” of OneCoin would occur on various dates in 2018 and 2019, in an effort to generate excitement and solicit additional investments from member victims. However, the purported offering was repeatedly postponed, and no such offering has taken place.

Image: OneCoin’s office in Sofia, Bulgaria.

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