Often seen at public events in a full-length ballgown, diamond earrings and a slash of trademark red lipstick, Dr Ruja Ignatova has been described as "a cross between Belle from Beauty and the Beast and Steve Jobs".
er unbridled glamour certainly belied her on-paper credentials: as one of the richest women in Europe, the consultant working in international finance had a degree from Oxford University, a PhD in law and a stint with the hallowed management consultancy McKinsey. If you were going to trust someone launching a cryptocurrency, it would be her.
At a sold-out event at Wembley Stadium in June 2016, Ignatova, then 36, promised that she would revolutionise digital currency with her cryptocurrency OneCoin. She called her creation the 'Bitcoin killer', referring to the world's best-known cryptocurrency. Soon, she noted, its 'users' would be able cash in their coins in for real money on a public exchange.
Documents leaked to the BBC show that British people spent almost €30m on OneCoin in the first six months of 2016, €2m of it in a single week. Between August 2014 and March 2017, more than €4bn was handed over in dozens of countries, including Ireland. Analysts have estimated that between January and June 2016 €1.47m was spent on OneCoin from Irish-based users.
By late 2017, Ignatova had vanished, as had the money entrusted to her by one million 'investors'.
Podcast producer Georgia Catt got wind of the astonishing story after a friend visited for dinner. "He had invested in OneCoin, and was just raving about this new cryptocurrency," she says. "He was convinced it was going to change the world. He showed us that he had invested €7,000 and how it had somehow 'grown' to €30,000."
On further investigation, Catt realised the full extent of the situation, and that she had the makings of a hit podcast. She enlisted tech author and journalist Jamie Bartlett, who already had a professional interest in cryptocurrency and cybersecurity.
"When we looked into Dr Ruja and saw the source of the showmanship and these crowds at Wembley going crazy, you realise the kind of hold she has over people," he says. OneCoin, in his words, is "an old-fashioned pyramid scheme".
The resulting BBC podcast, The Missing Cryptoqueen, has been downloaded almost 5 million times, and no wonder. The tale of what happened to Ignatova remains a mystery and, despite a lengthy investigation, she still remains at large.
The podcast lays bare an extraordinary life: born in Bulgaria, Ignatova emigrated to Germany at 10, and earned a PhD at the University of Konstanz. In 2012, she was convicted of fraud in Germany in connection with her and her father's acquisition of a company that shortly afterwards was declared bankrupt in somewhat murky circumstances. She was given a suspended 14-month prison sentence.
Two years later, she founded OneCoin, with headquarters in Sofia, the Bulgarian capital. She was certainly on to something in her belief that cryptocurrency had the potential to upend the orthodox financial industry. But already, there was a suspicious flaw in her plan: the 'currency' didn't have a blockchain, the technology or database needed to make a cryptocurrency work.
Forbes 'cover'
In October 2016, four months after her London appearance, Bjorn Bjerke, a blockchain expert, was offered the job of chief technical officer for a cryptocurrency start-up from Bulgaria. He soon realised he was being asked to build a blockchain, despite the company having been running for a while. He didn't take the job.
Regardless, Ignatova talked a good game. At events, attendees were shown a Forbes magazine with her on cover; except it was actually an inside cover - a paid-for advertisement - from Forbes Bulgaria.
The runaway success of her scam was more an accident of timing than anything else. In this period of dizzying technological change, authorities are still attempting to fully regulate cryptocurrencies.
Jillian Godsil, an Irish journalist and broadcaster considered one of the world's most influential voices in the world of blockchain, is convinced of the technology's power to do good in the world and "solve big problems". The velocity of the industry clearly thrills her, and she speaks fondly of the 'vibrant' community, both globally and in Ireland.
"If your kids are still going to school and thinking of going into tech, make sure they get into blockchain," she says. "It's a huge growth industry.
"The reason why the status quo trash-talk cryptocurrencies is that they threaten their control of the world," she adds. "Jamie Dimon of JP Morgan said Bitcoin was a scam, but last year he announced the JPM coin [digital currency]. Facebook banned cryptocurrency ads but they launched Libra last year."
Godsil is predictably less than enamoured of OneCoin. "OneCoin is a scam," she says definitively. "It's disgusting because it brings down everything else. Just because they called it a cryptocurrency doesn't mean it was one - but they used the global sentiment at the time to pretend they were. They could have been selling bulbs, tomatoes, fine art..."
It was a Ponzi scheme, she says, using the lure of cryptocurrency to entice people further down the chain.
But why did people find such a vague proposition so attractive? By the early 2010s, many had had their fill of bank bailout stories, and were seeking an alternative to traditional financial institutions.
"That it was so cleverly framed as a sort of revolution - you can see how so many people would have believed it," says Bartlett. "There was this positive message that [cryptocurrency] was democratising money and taking down the big evil banks we've been bailing out. It was the perfect message for the time."
Not only that; tales were rife of early Bitcoin adopters who bought $10 worth of the new currency and became multimillionaires once it eventually floated on online exchanges. Within crypto circles, the infamous tale of Laszlo Hanyecz also stands out: in 2010, unaware of just how valuable Bitcoin would eventually become, he paid for a takeaway pizza with 10,000 Bitcoins. That fateful meal has been called the '$80m pizza order'.
"A lot of people did make money," says Godsil. "Brock Pierce [the former child actor and current US presidential candidate] invested early and became a billionaire."
Long story short, the promise of riches keeps people believing in the potential of a new currency, and the hope of discovering the 'next Bitcoin' weighs heavily on investors' minds.
"Most OneCoin investors were not technical people, and were not cryptocurrency experts," says Catt. "Largely, they came from a world of multi-level marketing, and that's one of the reasons why it worked."
Multi-level marketing, or MLM, is a strategy some companies use to encourage existing distributors to recruit new ones, and are paid a percentage of their recruits' sales. In the case of OneCoin, it meant that people buying the cryptocurrency were often encouraging friends and family to invest.
"That's why the recruitment system is so good - it's not a hardened salesperson knocking at your door, it's your friend," Catt says.
The success of The Missing Cryptoqueen has prompted a flurry of media investigations into similar scams. Meanwhile, victims of OneCoin are contacting Bartlett and Catt regularly, from as far afield as Pakistan and Australia.
In the podcast, Bartlett meets Daniel Leinhardt, a 22-year-old Ugandan who lost his savings by buying into Ignatova's fake cryptocurrency. Jen McAdam from Scotland also talks about her regret at convincing her family to put €250,000 in OneCoin.
Somewhat startlingly, there are still OneCoin 'investors' who still very much believe in it.
"It's really quite heartbreaking," says Catt. "It doesn't seem to worry them that Ruja is gone. In fact, one person noted that Ruja had disappeared, almost as a sacrifice; like, 'if she's caught now, then the whole thing will collapse, so she's being really wise and generous staying out of the limelight and at some point she'll return'. When prophecy fails, they believe more strongly. I mean, the power of delusion when you think you're going to make money is incredible. You can kind of convince yourself of almost anything."
Bartlett adds: "If you think of how many people are anti-vaxxers or think 9/11 was an inside job against all the weight of argument and logic, it's the same sort of thought process."
As the billions rolled in, and Ignatova bought properties and stakes in companies. There were racing investments in Dubai and superyachts moored in the Black Sea.
At one point, American prosecutors alleged that Bank of Ireland accounts were used to launder €273m in the OneCoin scam. In late 2019, Bank of Ireland employees declined to testify in US criminal proceedings regarding OneCoin.
Documents lodged in a New York court show that in 2016, US lawyer Mark Scott contacted Bank of Ireland allegedly on the premise he was acting for an investment vehicle, to be called the Fenero Funds. He told the bank the money for the funds came from wealthy European families, it was claimed. Fenero needed the accounts to invest in European businesses with 'European money', he is said to have told the bank. The US department of justice alleged that the OneCoin was in effect a multibillion-dollar pyramid scheme, based "completely on lies and deceit".
Getting people to talk on the record about their experiences of OneCoin and similar schemes has been difficult for Bartlett, and indeed for Review. One anonymous person in Ireland said: "The guy that got me to invest [in a cryptocurrency] is a close acquaintance and still tells me it's not a scam. He has his head in the sand because he got so many business people to invest heavily."
Bartlett says: "When you're dealing with a scam worth billions of euro, it's not unusual for shadowy groups to get involved. Several of the people Georgia and I interviewed spoke darkly about mysterious people and connections they didn't want to name."
'Financial revolution'
For its part, OneCoin told the BBC: "OneCoin verifiably fulfils all criteria of the definition of a cryptocurrency."
It also said The Missing Cryptoqueen podcast "will not present any truthful information and cannot be considered objective, nor unbiased". It added that the allegations made about it were being challenged, stating: "Our partners, our customers and our lawyers are fighting successfully against this action around the globe and we are sure that the vision of a new system on the basis of a 'financial revolution' will be established."
Godsil observes that the mantra "only invest what you can afford to lose" is common in crytpocurrency circles. In the meantime, she has little idea as to when or how the industry will be fully regulated.
"A technology is not moral," she says. "Cryptocurrencies are not good or bad - they are digital money. It's like suggesting a computer is bad because you can watch child pornography on it. But OneCoin was a scam, called itself a cryptocurrency, and stole billions of dollars from people who could least afford it."
As the search for Ignatova continues, there is speculation that she is living in Frankfurt with her young daughter. Others believe she is moving between Russia and Dubai. Some say she is being protected in her native Bulgaria. Others believe she is dead. In early 2019, she was charged in absentia by US authorities for wire fraud, securities fraud and money-laundering. Her brother Konstantin Ignatov pleaded guilty to charges of money laundering and fraud in March last year.
Word has got back, somehow, to Catt and Bartlett that Ignatova herself might be listening to the podcast.
When it comes to finding her, it hasn't been for want of trying on Barlett's part.
Thanks to the popularity of the podcast, he is receiving tip-offs on her whereabouts all the time, he feels that he and Georgia are "getting closer to working out what happened to her, and where she is".
"We have things coming in from various channels," he says. "The key thing to finding a missing person is to try to build up a comprehensive picture of their life and activities and interests, because that's how we're going to figure out what sort of things they would do."
The Missing Cryptoqueen remains a work in progress, with no real clue as to how or when the tale will meet a resolution, if at all. And that's probably become the most compelling part of it all.
'The Missing Cryptoqueen' can be heard on BBC Sounds. See bbc.co.uk/sounds
The tech that underpins the best-known cryptocurrencies
The number of crytopcurrencies is not clear, but most estimates put it in the thousands, with Bitcoin the best-known.
The database technology underpinning them is called a ‘blockchain’. This is basically a ledger system, says Andrew Tzialli, Dublin-based head of cryptocurrency and blockchain group at the law firm Philip Lee.
“There is not one [single] entity in the world that can control what goes on the ‘ledger’,” he says, “but if Tanya sends Andrew some Bitcoins from her crytpocurrency wallet, for instance, it all goes on the Bitcoin ledger, and all of us have access to that. Once that transfer is on the ledger, it’s irreversible.”
Several of the biggest crytopcurrencies can be found on an exchange, such as Coinbase or KuCoin, and can be converted into dollars, sterling or euro.
Owing to the newness of the industry, “huge amounts of [cryptocurrency] are unregulated, mass market manipulation is rife and insider trading happens a lot,” Tzialli adds. “You are still gambling to an extent, but the bigger the currency, the bigger the investors behind them.”
