ScamCoin.

• Author: O'sullivan, Andrea

EWCOMERS TO BITCOIN sometimes dismiss the cryptocurrency as a pyramid or Ponzi scheme. The OneCoin scam shows what it really looks like when a fake blockchain serves as cover for a multilevel marketing fraud that pays early investors with funds from new marks.

Here we see the near-messianic pageantry common to overhyped projects. We see Matryoshka armies of international holding companies and frontmen. We see starry-eyed everymen scrambling to invest every last family dollar in "educational materials" that come with "free" coins (to avoid triggering regulations). We see Curacaoan banking consortia, Maltese gambling concerns, and a mysterious maven manipulating everything behind the scenes before absconding suddenly into the night.

Jamie Bartlett's The Missing Cryptoqueen details the sleazy rise and unsatisfying fall of the OneCoin con while investigating the possible whereabouts of the swindler behind it all: a runaway wannabe-fashionista from Bulgaria named Ruja Ignatova.

IN AN INDUSTRY rife with swindles, OneCoin is in a league of its own.

It is common for cryptocurrency projects to overpromise on technology or skimp on security, leading to large losses on the market or in user wallets. It is not normal for a cryptocurrency to be structured like a multilevel marketing scheme, paying "investors" more on a defined schedule when they recruit others. Nor is it normal for the coin to be completely managed by a for-profit company without any actual blockchain at all, unbeknownst to the many eager "package holders." Consequently, no other alleged cryptocurrency has managed to concoct a mammoth Ponzi scheme resulting in $4 billion to $15 billion in losses. Only Bernie Madoff can compare.

Ignatova had no expertise in computer science or technology. Her main selling points were that she used to be a consultant at McKinsey--so impressive--and liked to wear long gowns and red lipstick. This, combined with her exotic Germano-Bulgarian accent and links with various Sofia elites, proved enough to dazzle gullible targets into putting far too much money into her blockamamie scheme.

Bartlett, who chronicled the early bitcoin and contemporary cy pherpunk communities in his 2014 work The Dark Net, teases out what few threads we have on the furtive Ignatova to weave a portrait of an ambitious and shameless con woman who stopped at very little to project the image of herself that she wanted onto the world. She wanted to be rich, she wanted to be glamorous, and...