OneCoin: The Crypto That Crashed and Burned

    graph TD;
	    A[Investors] -->|contribute money| B[OneCoin]
	    B -->|uses funds for new sales investment| C[New Investors]
	    C -->|expect returns| A
	    A --> |loses everything| D[Empty Pockets]

## Which of the following statements best describes OneCoin? - [x] A fraudulent cryptocurrency scheme that promised high returns without a real cryptocurrency backing it. - [ ] A legitimate and functional cryptocurrency with real-world applications. - [ ] A new flavor of candy that’s only popular in Bulgaria. - [ ] An investment opportunity run by a legitimate financial advisor. > **Explanation:** OneCoin was indeed a fraudulent cryptocurrency scheme with no actual product or returns. ## What was one of the main business strategies of OneCoin? - [x] Selling educational materials falsely presenting investment opportunities. - [ ] Offering high-yield savings accounts at a bank. - [ ] Running a daily webinar about how to diversify investments in stocks. - [ ] Collecting donations for imaginary charities. > **Explanation:** OneCoin profitted by selling educational materials more than actual cryptocurrencies. ## What happened to Ruja Ignatova? - [x] She disappeared mysteriously in 2017 and is now a wanted fugitive. - [ ] She started a successful line of popular cryptocurrencies. - [ ] She decided to invest in real estate. - [ ] She became a personal finance guru teaching good investing habits. > **Explanation:** Unfortunately for investors, Ruja Ignatova disappeared right after defrauding them; she's now on the FBI's Most Wanted list. ## How did Sebastian Greenwood contribute to OneCoin? - [ ] He wrote a bestseller about real investing strategies. - [ ] He managed the technical side of developing a real coin. - [x] He co-founded OneCoin and is currently imprisoned due to its fraudulent activities. - [ ] He became an advocate for legitimate cryptocurrencies. > **Explanation:** Greenwood was key to running OneCoin and is now in jail because of its fraudulent nature. ## Why is OneCoin considered a Ponzi scheme? - [x] Returns paid to earlier investors came primarily from the money contributed by new investors, not from profit earned. - [ ] It had a functional wallet and trading platform that clients could use. - [ ] It trained investors on proper investment techniques. - [ ] All involved received some money back and were happy. > **Explanation:** OneCoin did not operate on honest returns but instead funneled money from new investors to earlier ones, a hallmark of Ponzi schemes. ## What is the fate of the investment made in OneCoin? - [x] Largely irretrievable with little likelihood of returns. - [ ] Looking promising for investors now as it is getting popularity! - [ ] Heading to the moon as new cryptos are put in! > **Explanation:** Sadly, investments in OneCoin are lost; the "currency" has no value. ## What creative reason might people still hold on to OneCoin? - [ ] The desire for a fortune in quick returns seemed awesome! - [x] Holding onto a soon-to-be collector's item or myth in cryptocurrency folklore. - [ ] Clearly believing that it can be swapped during Halloween for a real treat. - [ ] As a reminder to exclude scams from future investments! > **Explanation:** Some may whimsically wait thinking it could become a collector's item while learning valuable lessons against scams. ## How did OneCoin mislead its users? - [x] It claimed high returns with a nonexistent cryptocurrency, alongside faulty educational materials. - [ ] It taught users a step-by-step guide to creating real wealth. - [ ] It promoted freely available good educational resources. - [ ] It provided unlimited cryptocurrency through sighing. > **Explanation:** Most of OneCoin's platforms should be classified under “What NOT to do!" ## The total amount of money raised by OneCoin is estimated to be? - [x] $4 billion - [ ] $100 billion - [ ] $1 million - [ ] $0.5 billion > **Explanation:** OneCoin precisely raised around $4 billion from gullible investors, highlighting how massive such fraudulent schemes can become. ## What is a critical lesson learned from OneCoin’s story? - [ ] Boy, cryptocurrency is entirely impractical. - [ ] Always don’t take investments too seriously. - [x] Conduct thorough research and skepticism before investing in unfamiliar ventures. - [ ] Just trust everything crypto! > **Explanation:** The paramount takeaway here is due diligence; being cautious in investments could save you from tragic loss, such as experienced within OneCoin!