Italy Bans Onecoin Over Fraud Investigations

The so-called cryptocurrency has been previously regarded as a scam, but this time, the fraud allegation reached institutional ears: the government of Italy has decided to ban the asset, which has been linked multiple times with a multilevel-Ponzi scheme.

The Italian authorities argue that the service provided by the company behind the ‘cryptocurrency’ doesn’t deliver what it promises to its customers. Since several months ago, the number of people and websites which label Onecoin as a scam has significantly increased. The scheme, led by Bulgarian lawyer Ruja Ignatova, is promoted by a Gibraltar-based company called OneLife.

OneLife calls Onecoin a ‘cryptocurrency’ when in reality the coin isn’t decentralized nor does it have a public ledger (a blockchain). The company uses a centralized database, and according to several users, it is currently using a mock-up website with dummy data to represent the ‘transactions’ being sent back and forward by the ‘network’.

Onecoin is closed-source, something very uncharacteristic in public blockchains. Bitcoin users and cryptocurrency enthusiasts all over the world are trying to raise their voices over this issue, as it might give a negative image to other digital tokens. In Italy, for the first time a public institution decided to take action.

The Italian Competition Authority (L’Autorità Garante della Concorrenza e del Mercato) has ordered to freeze all operations from Onecoin parent company (One Network Services Ltd.), describing the service as a multilevel scam. Authorities from countries like Bulgaria, Sweden, Finland, Latvia, and Norway are said to be actively investigating Onecoin over fraud allegations.

The Italian authority specifically warned about two websites dedicated to the selling of Onecoin tokens (including, labeling their business as ‘illegal on Italian soil’. Public officials interviewed several members of the Onecoin scheme, they noted that none of them were able to successfully explain the exact nature of the business, nor able to justify the promised financial returns.

The Italian Competition Authority declared that an investigation is ongoing, and while it lasts, all activities associated with Onecoin parent company, including the selling, promotion, and issuance of the coin, will be prohibited.

Will the long lasting scam survive in the rest of the world? So far it is likely, but at least they won’t get away with it in Italy.

Source: AGCM.IT

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  • SMAM

    I hope soon all the EU members and then all the world will take action and ban this scam.

  • درویش

    Soooooo, Let me get this straight:

    1.) Onecoin is a “FINTECH company”

    2.) most transparent

    3.) “Bitcoin Killer”

    4.) “What gives cryptocurrency value is usability. We plan to be the
    most usable cryptocurrency and easy for the merchants” – Ruja Ignatova

    5.) it’s “easier to use than bitcoin”

    6.) …But can ONLY be used to a.) buy likely overpriced goods from
    fellow club members (at whatever exchange Tate they see fit???), or b.)
    convert into virtual shares which would inherently be highly volatile,
    thereby destroying the whole facade of “creating stability fit the
    coin,” unlike other crypto

    7.) Merchants have zero liquidity (other than volatile shares)

    8.) if merchandise/ product is sold for 100€ than merchant pays
    company 25€ outright, BUT IF HE WANTS TO WITHDRAW CASH PAYS ANOTHER 30€
    to withdrawal???

    RE #8: I don’t think the maths works:

    50% MUST be in OC. Therefore, a 100€ product sold 50/50 (half OC/ half€) leaves a 55€ expense. *scratches head

    Soooo, in this scenario, which is the minimum acceptable model (ie.,
    “must offer product in 50% OC”) how or from where is the remaining 5€ in
    actual money accounted for or collected from? Merchant receives just
    45% of original price ….but in OC ONLY???

    BY CONTRAST, BITCOIN (an old and outdated cryptocurrency – the
    “MySpace” if you will to Onecoin’s “Facebook” solution), HAS THE

    OpenBazaar: “A Free Market for all. No Fees. No Restrictions. Download · It’s open source. View the code.”

    Just wow! So much for “The Future of Payments” and “Banking the
    Unbanked” – bringing affordable banking and Payments to the world.
    Uggggh! SMH!!! Lol.