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What is the ruling on OneCoin? Is it permissible?

للها لوسر ىلع ملاسلاو ةلاصلاو لله دمحلاو للها مسب

OneCoin (also known as OneLife) and its supporters/participants claim it is a legitimate cryptocurrency like Bitcoin. Let us explore and discuss the validity of their claim.

Please note: this document supersedes all previous versions. This is the first published version. Caution: videos referenced in the footnotes are only included to provide proof, but may sometimes contain impermissible content.

Introduction

To determine whether it is permissible to participate in the OneCoin scheme, we will investigate:

what OneCoin is

whether OneCoin is a reputable and credible organisation or not

the history of the founders and leaders

the legal status of OneCoin

its portrayal in the media

how payments work

whether the economic claims are valid

the value of the educational packages

if OneCoin is an actual cryptocurrency or not

what the experts say regarding OneCoin

This will be followed by a summary of the findings and, thereafter, the Islamic ruling.

What is OneCoin?

OneCoin *1 (now part of OneLife) claims to be a cryptocurrency (explained later) which sells education packages. 2* 3* These come with “free” tokens which are claimed to be used to mine

(create) coins (also explained later).

Members often recruit others to join the scheme to generate commissions and bonuses via a multi-level marketing (MLM) structure 4*, though it is also possible to “purchase” a package as an investment.

Is OneCoin a reputable and credible company?

Firstly, it is important to determine if OneCoin is an honest and reliable organisation. This is especially important when it’s involved with cryptocurrency as there are many fake “coins” in this field *5. Let us look at a few examples of claims made by OneCoin:

Claims that Ruja Ignatova (founder of OneCoin) appeared on Forbes magazine cover *6 when in fact it was a paid advert *7 *8

*1 https://www.onecoin.eu/en/about

*2 https://www.onecoin.eu/en/faq

*3 https://www.onelife.eu/en/oneacademy

*4 https://www.onelife.eu/en/global-compensation-plan

*5 http://www.badbitcoin.org/thebadlist/

*6 http://web.archive.org/web/20160312103515/https://www.onecoin.eu/news/details/forbes_interview

*7 http://behindmlm.com/companies/ruja-ignatovas-onecoin-forbes-cover-a-paid-advertisement/

*8 http://forbesbulgaria.bg/wp-content/uploads/2015/05/Cover_49.jpg
Similar claim for Financial IT magazine cover *9 *10 which again was a paid advert *11 *12 - now no longer appears in the archive list of past issues *13
Claims of Ruja Ignatova being an invited speaker at The Economist’s Fourth EU–Southeast Europe Summit, but they had paid to be a platinum sponsor *14 (now redacted from The Economist’s own site *15)
Claims of One World Foundation and SEVA Canada partnership *16 *17 - despite the charity severing all ties18; similar claims with other charities
Promised merchants by end of 2015 *19 - no merchants to date
Promised between 50,000 to 500,000 merchants when 30% of coins had been mined *20 - still no merchants despite going past 40% *21 (Sept 2016) Note: this was on the old blockchain (see later)

Further claims of up to 1 million merchants ready within 2 years *22 - no merchants to date

Published fake letter from auditor to prove legitimacy *23
Claimed audits, but performed by an unknown company affiliated to OneCoin *24 *25
Claims of a UnionPay OneCoin Card *26 which UnionPay denied in press release *27 - only a prepaid card
Claims/promises of a MasterCard *28 prepaid card - MasterCard distanced itself from this and vehemently denied any authorisation *29

Claims that Ruja Ignatova is “business woman of the year” *30 - a title which is paid for *31
Claims to “bank the unbanked” *32, yet enforces a contradictory KYC *33 policy *34



*9 http://www.onecoin.wiki/?p=171&news=2258
*10 http://www.onecoinnorway.com/index.php?p=1_58_Dr-Ruja-Ignatova-on-the-cover-of-Financial-IT
*11 http://behindmlm.com/companies/onecoin/ignatova-does-it-again-another-fake-magazine-cover/
*12 https://financialit.net/sites/default/files/fit7_january.pdf (Jan 2016 edition)
*13 https://financialit.net/issues
*14 http://web.archive.org/web/20160711001341/http://www.economist.com/events-conferences/emea/sofia-2015
*15 http://www.economist.com/events-conferences/emea/sofia-2015
*16 http://web.archive.org/web/20150624042306/http://www.oneworldfoundation.eu/events.html
*17 https://m.facebook.com/story.php?story_fbid=1451193855171776&id=1386739924950503&_rdr
*18 http://behindmlm.com/companies/onecoin/seva-canada-returns-onecoin-donations-and-severs-ties/
*19 http://i.imgur.com/UHlrh1M.jpg (Dubai event, 2015)
*20 http://onecoin-finland.webnode.fi/news/onecoinin-maajohtaja-tommi-vuorisen-mediatiedote/ (Finnish)
*21 http://web.archive.org/web/20160817074537/https://www.onecoin.eu/en/ (Aug 2016; 802million/2.1billion = approx 40%; note: old blockchain count)
*22 https://www.businessforhome.org/2016/06/5000-attendees-at-the-onecoin-london-convention/
*23 http://web.archive.org/web/20151022075610/http://www.onecoinrevolution.info/letter-from-semper-fortis.html
*24 http://go4up.com/dl/4eca41d9c740ba/onecoininformation.zip
*25 http://www.bloomberg.com/Research/stocks/private/snapshot.asp?privcapId=261419004
*26 https://www.onecoin.eu/en/news/onecoin-to-issue-unionpay-cards
*27 http://www.unionpayintl.com/en/enaboutUpi/ennewsCenter/encompanyNews/3011997.shtml
*28 https://www.facebook.com/permalink.php?story_fbid=403822849829038&id=359291070948883
*29 https://www.youtube.com/watch?v=mF9cQNe3pS8 (German)
*30 http://onecointrust.com/guidebooks/RujaIgnatovaResearch.pdf
*31 http://minchev.com/en/businesswoman.html
*32 http://www.onecoinnorway.com/index.php?p=1_56_Banking-the-unbanked
*33 https://en.wikipedia.org/wiki/Know_your_customer
*34 https://www.onecoin.eu/en/compliance
A “legal opinion” *35 (with little to no information) was produced by a OneCoin Ltd company director, not an independent law firm *36
Much of the previous material/presentations emphasised the 2.1 billion coin cap, how it

“can never be changed”, “protected from inflation”, “only 2.1bn coins will ever be created”, etc. *37. This has now been increased manifold - to 120 billion (1st Oct 2016) *38
By OneCoin’s own definition, it is an “illegal money game” *39 *40
Claims to be the “Bitcoin Killer” *41, yet has so many disadvantages compared to Bitcoin, e.g. no users, no transparency, etc. More on this later.
Claims Bitcoin started "before terrorist attacks and before September 11 [2001]" 42* - actually started 8 years later (2009) 43*

KYC taking months to complete *44
Stealing $100Ks (OneCoin value) from affiliates *45; freezing accounts; confiscating coins
Claims of operating in over 230 countries *46 - only 195-20547 countries in the world

Conclusion: from the above, it is clear that there is a pattern of misinformation and deception from the company to give itself an air of respectability and credibility. There is also evidence of behaviour not expected of a reputable company. True respectability is earned by building a good reputation, especially from independent sources, not by paying for ads in magazines/events.

What do we know about OneCoin’s founders/leaders?

As with any organisation, we need to know a little history about the founders to know if this is a genuine company:
The founders (Ruja Ignatova, Sebastian Greenwood, etc.) have been involved in failed scams previously some of which are:
BigCoin *48 *49
BNA *50
Unaico *51 *52 *53 *54 *55 *56/SiteTalk *57 *58 *59


*35 http://www.coin-blog.de/wp-content/uploads/sites/128/2015/11/Breidenbach-OneCoin-Kryptow%C3%A4hrung-legal.pdf
*36 http://behindmlm.com/companies/onecoin/onecoin-legal-opinion-authored-by-director-of-the-company/
*37 http://www.slideshare.net/Onecoinplus/onecoin-secrets-revealed-2015-54053389
*38 http://onecoinpartners.com/onecoin-news/new-onecoin-blockchain-120-billion-coins/
*39 http://image.slidesharecdn.com/onecoinofficialenmarch2015-150423073230-conversion-gate02/95/onecoin-or-one-coin-compensation-plan-4-1024.jpg?cb=1429844493
*40 http://www.slideshare.net/shaikhamin/one-coin-compensation-plan
*41 http://grantcardonetv.com/video/thecoinprofit/the-bitcoin-killer-juha-parhiala/
*42 https://www.youtube.com/watch?v=2BCj8EoyT2I#t=5m15s
*43 https://en.wikipedia.org/wiki/Bitcoin
*44 Many complaints can be found on OneCoin Facebook page and elsewhere before being deleted
*45 http://imgur.com/a/WaG7d (screenshots of subsequently deleted content)
*46 Https://3.bp.blogspot.com/-fdYzEWmRUgs/V5YsuEBmrUI/AAAAAAAAEJw/m5ZBG7buLUYCPeJkufKm3pkLCX0RbbUEgCLcB/s 1600/OneAcademy.png (screenshot; since corrected to 190+ countries)
*47 https://en.wikipedia.org/wiki/List_of_sovereign_states
*48 https://youtu.be/T7L6AdMQEcM (Ignatova giving a presentation on behalf of BigCoin)
*49 http://bigcoin.co/
*50 http://behindmlm.com/companies/onecoin/bigcoin-bna-the-original-onecoin-ponzi-points/
*51
http://web.archive.org/web/20160312141342/http://www.secp.gov.pk/Publicwarnings/activitiesUnaico PublicWarning-July.jpg
Prosper Club *60
Loopium *61 *62, etc.
Tom McMurrain, leader (USA) *63, is a serial scammer *64 who has been jailed for Ponzi fraud and ordered to pay $7.5 million in restitution to his victims *65

OneCoin is simply a clone of BigCoin/BNA *66
Ruja Ignatova pleaded guilty to and was convicted in Germany *67 (March 2016) for 24 counts of financial fraud, embezzlement from her employees and suppliers, given a

14 months sentence on probation and ordered to pay restitution to her victims *68 *69 *70 *71

Ruja Ignatova has recently purchased $20 million of property in Bulgaria *72

Ignatova has links to drug mafia through a host of shell companies *73 *74
OneCoin has been buying out failed Ponzi/pyramid scams such as Conligus *75 *76, OPN (formerly Unaico), SiteTalk *77, Bonofa *78, BNG International, Univerteam *79 and WeShare *80


*52 http://www.dawn.com/news/715788

*53 http://www.dawn.com/news/1160623

*54 http://www.dawn.com/news/1148707

*55 http://www.pakistantoday.com.pk/2012/05/05/national/nab-starts-probe-into-unaico-ponzy-scheme/

*56 http://web.archive.org/web/20151028105519/https://www.fma.gv.at/en/consumers/investor-warnings/national-investor-warnings/detail-natwm/article/unaico-ltd-enigro-group.html

*57 https://www.youtube.com/watch?v=5Q89YJ-C9Pg

*58 http://www.realtid.se/svenskarna-bakom-unaico-och-sitetalk (Swedish)

*59 http://ha.ntga.gov.cn/default.php?mod=article&do=detail&tid=278480 (Chinese)

*60 http://prosperinc.co/

*61 http://web.archive.org/web/20121117004012/http://www.loopium.com/

*62 https://www.linkedin.com/in/mrsebastiangreenwood

*63 https://www.onelifeevents.eu/en/events/uk-national-event

*64 http://amlmskeptic.blogspot.co.uk/2016/04/is-it-just-series-of-bad-judgment-or.html

*65 http://www.bizjournals.com/atlanta/stories/2005/10/10/daily23.html

*66 http://behindmlm.com/companies/onecoin/onecoin-literally-a-relaunch-of-bigcoin

*67 https://www.pdf-archive.com/2016/06/30/report/ (German)

*68 http://www.dkp-muenchen.de/index.php?option=com_content&view=article&id=623:allgaeu-krimi-um-das-gusswerk-waltenhofen&catid=35:kategorie-dkp-allgaeu&Itemid=44 (German)

*69 http://www.all-in.de/nachrichten/lokales/Ueber-drei-Jahre-nach-der-Pleite-Bewaehrung-fuer-Ex-Chefin-des-Waltenhofener-Unternehmens-Gusswerk%3bart26090,2250751 (German)

*70 http://www.ess.fi/uutiset/kotimaa/art2291676 (Finnish)

*71 http://www.savonsanomat.fi/kotimaa/Uuden-virtuaalivaluutan-taustatiimill%C3%A4-Wincapita-yhteyksi%C3%A4-ja-petostuomioita/813727 (Finnish)

*72
http://www.capital.bg/biznes/kompanii/2016/05/13/2759325_doktor_ruja_i_pazaruvaneto_na_imoti_ot _nishto/ (Bulgarian)

*73 http://i.imgur.com/0IowjBr.png (English translation)

*74
http://www.capital.bg/biznes/kompanii/2016/05/13/2759325_doktor_ruja_i_pazaruvaneto_na_imoti_ot _nishto/ (original article source; Bulgarian)

*75 https://www.onelife.eu/en/news/onecoin-conligus-1year

*76 https://www.businessforhome.org/2015/02/conligus-freezing-commissions/

*77 https://www.businessforhome.org/2016/01/onecoin-welcomes-network-marketing-company-opn-sitetalk/

*78 https://www.youtube.com/watch?v=CGtcYRPtHvY

*79 https://www.businessforhome.org/2016/03/onecoin-completes-acquisition-of-univerteam/

*80 http://us9.campaign-archive2.com/?u=cf9659fd672fe664d487e7e1b&id=c5cc06fe8b (Newsletter: 3 Oct, 2016)
+








Conclusion: the history of the founders/leaders is extremely concerning. While a criminal past is not necessarily indicative of future behaviour, yet when the latest scheme is based off a previous scam, we can only conclude that this is more of the same.

Is OneCoin legal?

Investigations by regulators/official organisations is not usually a good sign:

Germany’s financial regulator BaFin is currently investigating OneCoin *81

Sweden’s Gaming Board made a police report against Onecoin for breach of the Lotteries Act after calling it a “pyramid scheme” *82; Swedish police currently investigating OneCoin *83

Investigated by Finland’s National Bureau of Investigation at the request of the Police Board; police keeping tabs and called for utmost caution *84 *85 *86 *87

Belgium’s Financial Services and Markets Authority (FSMA) warned against risks associated with OneCoin *88, though generic to all “virtual money”

Austria’s AK Consumer Protection organisation cautioned against OneCoin indicating that it’s a “pyramid scheme” and gave a fraud warning *89 *90
The Norwegian Direct Selling Association warned against fraud and called it a “pyramid scheme” *91

The National Bank of Hungary issued a warning against OneCoin calling it a “pyramid scheme” *92 *93

Latvia’s Financial and Capital Market Commission issued a warning saying that OneCoin is modelled on a “pyramid scheme” *94

Bulgaria’s Financial Supervision Commission warned of “a high risk” +95
Indian Police called OneCoin a “fraud company” *96


*81 http://www.spiegel.de/spiegel/vorab/bafin-prueft-internetwaehrung-onecoin-a-1095657.html (German)
*82 http://www.lotteriinspektionen.se/sv/Press/Nyheter/OneCoins-verksamhet-polisanmalt-for-misstankt-brott-mot-lotterilagen/ (Swedish)
*83 http://www.gp.se/nyheter/g%C3%B6teborg/polisen-utreder-onecoin-1.6048 (Swedish)
*84 http://www.hs.fi/talous/a1429846410546 (Finnish)
*85
http://yle.fi/uutiset/osasto/news/finns_investing_millions_in_new_virtual_currency_police_keeping_tab s_on_case/8743590
*86 http://www.hs.fi/talous/a1446613276082 (Finnish)
*87 https://www.poliisi.fi/keskusrikospoliisi/tiedotteet/1/0/krp_on_selvittanyt_onecoin-virtuaalirahaa_41044 (Finnish)
*88 http://www.fsma.be/en/Site/Repository/press/warnfsma/2016/07-08_onecoins.aspx
*89
https://stmk.arbeiterkammer.at/beratung/konsumentenschutz/achtung_falle/onecoin_betrugsverdacht. html (Austrian)
*90 http://steiermark.orf.at/news/stories/2767892/ (Austrian)
*91 http://www.direktesalgsforbundet.no/vil-ikke-vaere-politi/ (Norwegian)
*92 http://www.mnb.hu/felugyelet/felugyeleti-keretrendszer/felugyeleti-hirek/hirek-ujdonsagok/sajtokozlemeny-ujabb-kockazatok-a-fizetesre-hasznalhato-virtualis-eszkozok-koreben (Hungarian)
*93 http://24.hu/fn/penzugy/2016/10/31/vigyazat-atveres-penzere-palyaznak-a-piramisjatekosok/ (Hungarian)
*94 http://www.fktk.lv/lv/klientu-aizsardziba/bridinajumi-par-nelicencetiem/5659-fktk-bridina-par-onecoin-sniegtajiem-pakalpojumiem.html (Latvian)
*95 http://www.fsc.bg/en/news/saobshtenie-onecoin-7727.html (Bulgarian)
*96 http://www.newindianexpress.com/cities/hyderabad/First-cryptocurrency-fraud-busted-kingpin-arrested-in-Bengaluru/2016/07/28/article3550570.ece


The Office of Competition and Consumer Protection in Poland have launched an official investigation into OneCoin *97

Vietnam are investigating OneCoin *98
The Financial Conduct Authority (FCA) in the UK issued a warning against OneCoin, stated the City of London Police are currently investigating OneCoin for fraud and advised potential victims to report to Action Fraud *99
Arrests of investors and seizure of 300 million yuan (over £30 million)*100 in assets in
China and investigation by authorities *101; declared “fraudulent” by Regulator *102
Investors arrested in Bangladesh *103
Declared illegal in Colombia *104
Currently illegal in the US as OneCoin must register with the SEC *105 before they can operate in the US *106 which they have failed to do

OneCoin has released a few “legal opinions” from Germany *107, Sweden *108, Bulgaria *109, etc. The 2 from Germany were written in 2014 and 2015 before the investigation by BaFin (German regulator) and one of these was written by a OneCoin company director as discussed earlier. Additionally, these opinions are paid for, based on information provided by OneCoin, contain disclaimers (including non-disclosure to 3rd parties) and cannot override official investigations.

Conclusion: the sheer number of investigations and warnings for fraudulent activities across so many countries is huge cause for concern. Many investigations are ongoing while some have already reached the conclusion that it is a pyramid scheme.









+97 http://sejm.gov.pl/Sejm8.nsf/InterpelacjaTresc.xsp?key=70AA9084 (Polish)

*98 http://tuoitrenews.vn/business/37884/ponzilike-onecoin-trading-scheme-swindles-many-in-vietnam

*99 https://www.fca.org.uk/news/news-stories/beware-trading-virtual-currencies-onecoin

*100 http://www.zsnews.cn/news/2016/05/27/2865116.shtml (Chinese)

*101
http://news.qoos.com/%E7%B2%B5%E8%AD%A6%E6%8B%86%E8%A7%A3%E7%BD%AA%E7% 8A%AF%E9%9B%86%E8%B3%87%E6%8B%9B%E6%95%B8-2043698.html (Chinese)

*102 http://v.ku6.com/show/P8E-0i7rHG1lN3Y5y8P3sQ...html (Chinese news report)

*103
http://www.banglatribune.com/others/news/114555/%E0%A6%A1%E0%A6%BF%E0%A6%9C%E0% A6%BF%E0%A6%9F%E0%A6%BE%E0%A6%B2-%E0%A6%8F%E0%A6%AE%E0%A6%8F%E0%A6%B2%E0%A6%8F%E0%A6%AE-%E0%A6%AA%E0%A7%8D%E0%A6%B0%E0%A6%A4%E0%A6%BE%E0%A6%B0%E0%A6%A3 %E0%A6%BE-%E0%A6%9A%E0%A6%95%E0%A7%8D%E0%A6%B0%E0%A7%87%E0%A6%B0-%E0%A7%A8-%E0%A6%B8%E0%A6%A6%E0%A6%B8%E0%A7%8D%E0%A6%AF-%E0%A6%97%E0%A7%8D%E0%A6%B0%E0%A7%87%E0%A6%AB%E0%A6%A4%E0%A6%BE %E0%A6%B0 (Bengali)

*104 http://www.supersociedades.gov.co/noticias/Paginas/2016/Onecoin-Colombia-no-est%C3%A1-vigilada-por-la-Superintendencia-de-Sociedades.aspx (Spanish)

*105 https://www.sec.gov/investor/alerts/ia_pyramid.htm

*106 http://www.investopedia.com/ask/answers/08/unregistered-securities.asp

*107 http://www.digitalcurrencyinfo.net/wp-content/uploads/2016/04/Germany_Legal_opinion-2015.pdf

*108 https://www.yumpu.com/en/document/view/55776973/one-life-legal-opinion-wistrand-law-firm-sweden-july-2016

*109 https://www.pdf-archive.com/2016/10/25/onecoin-legal-opinion-bulgaria-november2015/

How is OneCoin portrayed in the media?

Several negative media articles in well-known national newspapers such as Der Spiegel *110 and The Mirror *111 *112 as well as Capital *113 and Banker *114, influential Bulgarian weekly independent business newspapers *115 *116

Numerous articles in mainstream (Finnish) media *117 *118 *119 *120 *121 *122 *123 *124 *125 and investigative reporting in YLE, Finland's national public-broadcasting company (Finnish equivalent to the UK’s BBC) *126 *127

Wide coverage in online cryptocurrency news sites such as Bitcoin.com *128, Coin Telegraph *129 *130, The Merkle *131, CoinDesk *132, CryptoCoinsNews *133, Bitcoinist *134, NewsBTC *135, etc.
More articles and news items can be found in the footnotes of this paper

Conclusion: there are many negative articles in the media across numerous countries which is not a good sign. One or two articles could be forgiven for being isolated examples of bad behaviour by staff,



*110 https://magazin.spiegel.de/SP/2016/17/144430297/index.html (German)
*111 http://www.mirror.co.uk/news/uk-news/who-wants-onecoin-millionaire-you-7346558
*112 http://www.mirror.co.uk/news/uk-news/seven-months-after-expose-crypto-8933566
*113
http://www.capital.bg/biznes/finansi/2015/09/04/2603688_doktor_ruja_i_praveneto_na_pari_ot_nishto/ (Bulgarian)
*114 http://www.banker.bg/finansov-dnevnik/read/opasni-strasti-s-onecoin (Bulgarian)
*115 https://en.wikipedia.org/wiki/Capital_(newspaper)
*116 http://www.worldpress.org/newspapers/EUROPE/bulgaria.cfm
*117 http://www.aamulehti.fi/kotimaa/uusi-virtuaalivaluutta-lupaa-suuria-tuottoja-mukana-olevilla-petostuomioita-ja-wincapita-yhteyksia/ (Finnish)
*118 http://www.sss.fi/2016/08/uusi-virtuaalivaluutta-lupaa-suuria-mutta-herattaa-kysymyksia/ (Finnish)
*119 http://www.karjalainen.fi/uutiset/uutis-alueet/kotimaa/item/112732-uusi-virtuaalivaluutta-lupaa-suuria-mutta-herattaa-kysymyksia (Finnish)
*120 http://www.ess.fi/uutiset/kotimaa/art2291676 (Finnish)
*121
http://www.ts.fi/uutiset/kotimaa/2741104/Uusi+virtuaalivaluutta+lupaa+suuria+mutta+herattaa+kysymy ksia (Finnish)
*122 http://www.kainuunsanomat.fi/kainuun-sanomat/talous/uusi-virtuaalivaluutta-lupaa-suuria-mutta-herattaa-kysymyksia/ (Finnish)
*123 http://www.kaleva.fi/uutiset/kotimaa/uusi-virtuaalivaluutta-lupaa-suuria-krp-kehottaa-varovaisuuteen/734974/ (Finnish)
*124 http://www.talouselama.fi/uutiset/uusi-bittivaluutta-herattaa-kysymyksia-perustajalla-petostuomio-6571908 (Finnish)
*125 http://kusetukset.blogspot.co.uk/2016/08/onecoin-receives-huge-media-coverage-in.html (translation)
*126 https://www.youtube.com/watch?v=B4u3DtZITAE
*127 https://svenska.yle.fi/artikel/2016/10/22/experter-varnar-kryptovalutan-onecoin (Swedish)
*128 https://news.bitcoin.com/beware-definitive-onecoin-ponzi/
*129 https://cointelegraph.com/news/one-coin-much-scam-onecoin-exposed-as-global-mlm-ponzi-scheme
*130 https://cointelegraph.com/news/keep-money-in-the-game-onecoin-moves-on-to-new-fantasy-blockchain
*131 http://themerkle.com/the-only-exchange-trading-onecoin-does-not-even-allow-signups/
*132 http://www.coindesk.com/london-police-investigate-onecoin-cryptocurrency-scheme/
*133 https://www.cryptocoinsnews.com/uk-authority-warns-using-onecoin/
*134 http://bitcoinist.net/industry-report-onecoin-scam/
*135 http://www.newsbtc.com/2016/08/29/onecoin-posts-fake-semper-fortis-letter-gain-credibility/

But when all the articles paint the entire OneCoin scheme in a negative light, it does not bode well for the legitimacy of OneCoin.

How do payments in/out work with OneCoin?

Payments, both incoming and outgoing, are very important for a company like OneCoin so that money can flow in and members are paid promptly.

MasterCard card issuing merchant owner *136 convicted for drug smuggling *137 leading to suspension of MasterCard processing *138
Exchange closed for maintenance for 15 days in March 2016 *139
Exchange closed again for weeks in October 2016

Huge delays, denials *140 and restrictions when trying to withdraw
Severe restrictions on coin Transfers *141 and sell Limits *142
Many bank accounts frozen/closed down in the last 12-18 months:

DSK Bank, Bulgaria under name One Network Services Ltd. (closed Oct 2015) *143

Noor Bank, Dubai [Onecoin Limited] (2015) *144
Capital Bank, Tbilisi, Georgia [One Payments Limited] (Dec 2015) *145
TD Bank, Canada (branch in Fl, US) [One LLC] (Feb 2016) *146

Kreissparkasse Steinfurt, Germany [International Marketing Services] (Mar 2016) *147
Lloyds TSB, UK (Apr 2016) *148

Commerzbank, Germany [IMS International Marketing Services] (Jun 2016) *149

Deutsche Bank, Germany [IMS International Marketing Services] (Aug 2016) *150
Banca Monte Dei Paschi Di Siena, Italy [Educamax Services SRL] (Sep 2016 within 24 hours) *151

China Construction Bank (Asia) Corporation Limited, Hong Kong [Foshan Everbright Import & Export Company Limited] (Oct 2016 within 2 weeks) *152

Hellenic Bank, Cyprus [Eastern Project Investments Limited] (Nov 2016 - within 2 banking days) *153

DBS Bank Ltd, Singapore [International Marketing Services Pte. Ltd] (Nov 2016) *154

DBS Bank Ltd, Singapore [Vernada Trading Ltd] (Nov 2016 within a few days) *155

*136 http://companydb.uk/09630600-buxton-enterprises-limited#.V9_ozPkrLZ7
*137 http://www.thelawpages.com/court-cases/Martin-Henry-Beckett-17202-1.law
*138 https://freshpickeddeals.com/onecoin.eu/onecoin-news-1728882 (Newsletter: 25 Apr, 2016)
*139 http://s27.postimg.org/uatig0pcz/image.png (screenshot)
*140 https://www.facebook.com/OneCoinOfficialPage/ (comments on posts before they get deleted)
*141 https://freshpickeddeals.com/onecoin.eu/onecoin-news-1797596 (Newsletter: 9 May, 2016)
*142 http://us9.campaign-archive2.com/?u=cf9659fd672fe664d487e7e1b&id=c7be0a929c (Newsletter:14 Nov, 2016)
*143 http://www.saunakeskus.fi/useruploads/files/OneCoin%20english%203.pdf (slide 18)
*144 https://freshpickeddeals.com/onecoin.eu/onecoin-news-182733 (Newsletter: 7 Sep, 2015)
*145 https://freshpickeddeals.com/onecoin.eu/onecoin-news-718344 (Newsletter: 16 Nov, 2015)
*146 https://freshpickeddeals.com/onecoin.eu/onecoin-news-837299 (Newsletter: 8 Dec, 2015)
*147 https://freshpickeddeals.com/onecoin.eu/onecoin-news-1622805 (Newsletter: 4 Apr, 2016)
*148 https://www.facebook.com/permalink.php?story_fbid=970332093060611&id=822713397822482
*149 https://freshpickeddeals.com/onecoin.eu/onecoin-news-1927648 (Newsletter: 6 Jun, 2016)
*150 https://freshpickeddeals.com/onecoin.eu/onelife-news-2356869 (Newsletter: 22 Aug, 2016)
*151 https://www.facebook.com/groups/OneCoinTeamDeutschland/permalink/1182198118510928/
(German)
*152 http://truffacoin.com/sites/default/files/styles/img_zoom/public/immagini/hk3_0.jpg (screenshot)
*153 http://behindmlm.com/companies/onecoin/onecoin-lose-cyprus-bank-account-bank-of-africa-remains/
*154 https://freshpickeddeals.com/onecoin.eu/onecoin-news-837299 (Newsletter: 8 Dec, 2015)
Update (14 Nov 2016): OneCoin lost its last remaining bank account: Bank of Africa, Tanzania [IMS Marketing Tanzania Ltd] (Nov 2016) *156

With all bank accounts shut down, OneCoin’s ability to accept payments is severely hampered and members now have to pay recruiters directly instead of the Company *157
Opening shell companies with no mention of OneCoin or OneLife as shown above

Conclusion: the large number of bank closures in a short period of time without notice strongly suggests falling foul of money laundering regulations. Additionally, the use of multiple shell companies to avoid detection is seriously problematic. Furthermore, the complete shutdown of all bank accounts and paying distributors/recruiters directly for packages should set alarm bells ringing.

Are OneCoin’s economic claims valid?

It is important to verify economic claims to see if they’re credible. We will look at 3 examples.

Example 1: The OneLife tablet

OneCoin proudly announced their OneLife tablet available for €550 *158. However, the specs are outdated (by approx. 5 years) and similar tablets are available for under £50 online *159. The tablet is already heavily overpriced.

However, it was also possible to purchase the tablet using OneCoins (option now removed) - priced at 1,160 OneCoins *160. Using the value according to the xcoinx exchange at the time of sale

(€6.23), that comes to €7226.80 - an increase of over 1,300% (or over 14,000% above its true value)! *161

Conversely, it means that 1,160 OneCoins are actually only worth €550 even according to OneCoin themselves, i.e. they’ve just reduced the value of OneCoins to €0.47 each as opposed to the alleged value of €6.23. However, since the tablet itself is only worth approx. €50-60, that would further reduce the value tenfold to approx. €0.05!

Example 2: The finite, fixed cap becomes unfixed

OneCoin promised that the coin cap will always be fixed at 2.1 billion as explained earlier. However, on Oct 1st, 2016, they increased the cap by an enormous 5,714% to 120 billion coins.

In any normal scenario, this would cause a huge decrease in value. This would mean that according to OneCoin themselves, with the current price (Sept. 2016) approx. $7.79, the price should plummet to $0.14. Even with the doubling of coins, that is effectively a reduction in value of over 96%. However, OneCoin have stated that the value will remain the same or even increase. OneCoin “do not expect a steep price movement” *162 after raising the coin cap to 120 billion.




*155 https://freshpickeddeals.com/onecoin.eu/onecoin-news-1443901 (Newsletter: 7 Mar, 2016)

*156 http://us9.campaign-archive2.com/?u=cf9659fd672fe664d487e7e1b&id=c7be0a929c (Newsletter:14 Nov, 2016)

*157 ibid.

*158 https://www.onelife.eu/en/onetablet

*159 https://www.alibaba.com/product-detail/9-6inch-Android-Tablet-MTK6582-Quad_60399753135.html?spm=a2700.7724857.0.0.I43y2m

*160 http://imgur.com/y8VELPK (screenshot, 18 Jun, 2016)

*161 http://behindmlm.com/companies/onecoin/onecoin-charging-7236-eur-for-a-550-eur-tablet/

*162 http://us9.campaign-archive2.com/?u=cf9659fd672fe664d487e7e1b&id=b9824cdd07 (Newsletter:18 Jul, 2016)


Update (Oct. 2016): Not only was the cap increased, coins are now “generated” 50 times faster at 50,000 per minute, i.e. approx. €350,000 per minute or approx. 2.19 billion coins (over €15 billion value) - equivalent to more than the market cap of all cryptocurrencies combined every single month *163

Example 3: The Ultimate package

Recently, OneCoin introduced a new €118,000 Ultimate package with over 1.3 million tokens and, with the doubling on October 1st, adds up to over 2 million coins *164. The “value” is approximately €7 currently. So just by buying this Ultimate package with €118,000, it will be “worth” approx. €14 million even without any increase in value. There’s little to no mention of educational packages. Even if the value dropped to only €1, that would still mean over €2 million “value” for “investing” €118,000.


Update (Oct. 2016): OneCoin have released even more expensive packages costing €188,000 and €225,500! *165 These prices are unprecedented and by far the most expensive in the MLM industry.

Conclusion: the economic claims do not reflect reality. In the tablet example, OneCoins are valued far below the “official” value. Increasing supply and flooding the market with coins should cause hyperinflation *166 and drastically reduce the value. To maintain the value defies all known economic rules, therefore the alleged value of OneCoin is not based on supply and demand *167 and is not real.

Are the educational packages worth the money?

This is an important question to consider as some of the package prices are so expensive that they cost more than full medical, doctorate and law degrees anywhere in the world.
The educational packages contain a huge proportion of plagiarised content *168 *169

They seem extremely overpriced *170 for the content provided - a similar or superior level of cryptocurrency expertise can be gained for free or minimal cost

All the focus seems to be on the “profit” and “value” of the coins *171 - little to no mention is made of the education in events, promotions, recruitment, etc.

If we consider the question: “If the “free” tokens were removed from the packages, would members be happy?”, it’s obvious the true “value” is in the tokens/coins, not education
Many members are from non-English speaking countries who cannot read English *172

Many members own multiple packages at the same level, e.g. Tycoon

The very expensive packages costing €118,000-225,500 have the same education as the much cheaper packages *173

*163 https://cointelegraph.com/news/keep-money-in-the-game-onecoin-moves-on-to-new-fantasy-blockchain

*164 https://www.youtube.com/watch?v=MjyLThaxbLg

*165 https://www.onecoin.eu/tech/

*166 https://en.wikipedia.org/wiki/Hyperinflation

*167 https://en.wikipedia.org/wiki/Supply_and_demand

*168 https://drive.google.com/file/d/0B4CyzrtK43UvY09KY19XeXBQMG8/view

*169 http://pjarvinen.blogspot.co.uk/2015/05/onecoin-koulutusmateriaali-kopioitu.html (Finnish; English summary)

*170 http://www.oneacademy.eu/en/

*171 https://docs.google.com/presentation/d/13NGkRkmuYDzHXHN3OZhZGtv0fnp_QdaCButhGSS88Hk/

*172 Only very recently added 3 additional languages (Newsletter: 10 Oct 2016): http://us9.campaign-archive1.com/?u=cf9659fd672fe664d487e7e1b&id=cf7d8b266d

*173 https://www.onecoin.eu/tech/


Conclusion: the heavily overpriced educational packages are not worth the price and seem to be included to avoid legislation. This means recruits are being misled about the value of the product.

Is OneCoin a cryptocurrency?

Before we consider whether OneCoin is cryptocurrency, let us define what a cryptocurrency is.

What is a cryptocurrency?

We will only provide a brief, simplified explanation here. Other concepts relating to cryptocurrencies are beyond the scope of this paper. It would be prudent for any person wishing to invest in cryptocurrencies (or otherwise participate in any scheme purporting to be one) to at least familiarise themselves with the basics before making that initial step. Further information can be found in the links provided in the footnotes.

A cryptocurrency is a virtual/digital currency which uses cryptography (encryption) to secure and verify transactions and to control the supply of new coins/units of currency. *174

They are fully decentralized, i.e. not in any one company or person’s control. They also have a finite supply (i.e. fixed, never to increase) to eliminate inflation and mimic precious metals like gold. *175 Likewise, similar to gold, new coins are created by a process called “mining”.

It uses a blockchain (a database of records which cannot be altered) which serves as a

distributed public ledger of all transactions allowing trustless transactions which can be verified by anyone and not require a 3rd party audit. *176

Is OneCoin a cryptocurrency?

Can’t make payments with OneCoin - further delayed to 2018 *177 *178

No users at all despite claiming “usability” *179 - without purchases, there are no users
OneCoin not found on any independent exchange or market at all, e.g. Coin Market Cap - despite listing over 700 coins including totally worthless ones *180

xcoinx, the only exchange which lists OneCoin, is actually owned by OneCoin/OneLife

xcoinx (before Oct 2016) is clearly fake, plagiarised *181 and edited from CoinMarketCap *182

xcoinx FAQ plagiarised *183 direct from BitStamp *184

xcoinx was “coming soon” since 1 Oct, 2016 coinciding with “new” blockchain *185
Update (Nov 2016): OneCoin has now transferred internal exchange to xcoinx *186 *187; no option to register; can only login with existing OneCoin/OneLife account



*174 https://en.wikipedia.org/wiki/Cryptocurrency

*175 https://www.cryptocoinsnews.com/cryptocurrency/

*176 https://en.wikipedia.org/wiki/Blockchain_(database)

*177 http://i.imgur.com/ErJ8rk2.jpg (screenshot; question)

*178 http://i.imgur.com/j4LgGVp.jpg (screenshot; answer by OneCoin support)

*179 https://www.onecoin.eu/en/

*180 https://coinmarketcap.com/all/views/all/

*181 http://web.archive.org/web/20160511213327/http://xcoinx.com/ (May, 2016)

*182 https://coinmarketcap.com/

*183 http://web.archive.org/web/20160316023121/http://xcoinx.com/faq

*184 https://www.bitstamp.net/article/relaunch-faq/

*185 http://web.archive.org/web/20161021054733/http://www.xcoinx.com/ (Oct 2016)

*186 http://xcoinx.com
Very strict restrictions on coin transfers (only to upline/downline and max of 5-40 coins) *188, selling and withdrawals with delays *189 and many request denials *190
Self-defined value *191
Centralised *192

Claims to be “Unique, Safe, Global & With No Risk of Inflation” *193 and “Unlike money issued by governments, there is a finite number of OneCoins, ensuring they cannot be affected by inflation” *194 - yet they increased the cap by over 57 times *195

Claimed (Sep 2016): “finite number of 120 billion coins” *196 when in Sep 2016, the “finite” cap was 2.1 billion, thus the claim of “finite” is misleading or false

Absence of crucial information to determine legitimacy:

no academic white paper

no peer review

no known Chief Technology Officer (CTO)

no known developers

no proof of mining

no sign of the computational power required for the purported number of transactions per second

no searchable public blockchain

no member transactions in blockchain

no public trading

no basic wallet system to send coins without restrictions

Closed (not open) source code (assuming it exists) despite claims of transparency *197

The OneCoin Blockchain

(Old) “Blockchain” *198 proven fake *199 *200 *201 - it was a cheap stock video to mimic mining *202

Update (Oct. 2016): New blockchain *203 is the same Shutterstock video on loop which can be purchased for between £14-54 *204 *205 *206

*187 http://us9.campaign-archive1.com/?u=cf9659fd672fe664d487e7e1b&id=26edd8bd70 (Newsletter:7 Nov, 2016)
*188 http://us9.campaign-archive1.com/?u=cf9659fd672fe664d487e7e1b&id=df7a54bca4 (Newsletter: 9 May 2016)
*189 http://us9.campaign-archive2.com/?u=cf9659fd672fe664d487e7e1b&id=e3437a95d9 (Newsletter:24 Oct 2016)
*190 https://www.coinhako.com/blog/scam-alert-july-2016/
*191 as discussed earlier when reviewing economic claims
*192 https://www.onecoin.eu/en/
*193 https://www.onecoin.eu/en/cryptocurrency
*194 https://www.onecoin.eu/en/about
*195 see economic claims example 2
*196 http://web.archive.org/web/20160928171838/https://www.onecoin.eu/en/about (28 Sep, 2016)
*197 https://www.onecoin.eu/en/about
*198 https://3.bp.blogspot.com/-UEXH6vKWYFM/VOXrlomgGhI/AAAAAAAADJc/lllk95YQEDg/s1600/oc%2Bblockchain.jpg
*199 https://medium.com/@BlockByBlock/why-onecoin-is-one-big-scam-555064d4f308
*200 https://www.reddit.com/r/Bitcoin/comments/4smxzo/onecoin_retiring_their_old_blockchain_and/d5blg 2w
*201 http://mrpoth.tumblr.com/post/145011384021/technical-proof-why-onecoin-is-a-scam
*202 http://www.shutterstock.com/video/clip-1089709-stock-footage-computer-program.html
*203 https://www.youtube.com/watch?v=4cLoZ75le8w
*204 http://www.shutterstock.com/video/clip-1089709-stock-footage-computer-program.html
OneCoin “retired its old blockchain” and launched a new one on 1 Oct 2016 so “they can make more OneCoins” because they “need more coins to grow” and “there are no more coins for the merchants and for Latin America and India” *207 *208 With 8 decimal places available, there’s no need for more coins *209 *210 and it should not be possible to modify a blockchain, i.e. it’s no longer a blockchain if it can be modified *211

Claims to be able to handle “more transactions than credit card providers” *212 which would mean handling more than an average of 2000 transactions per second (tps) and up to 56,000 tps for Visa alone *213

Claimed monthly audits of the blockchain from Semper Fortis - only 1-2 done with no technical information and a disclaimer that it is only to be used internally and not suitable for 3rd parties, e.g. for promotion *214
Claims to be “the first cryptocurrency auditing its blockchain by an idependent [sic] auditor on a monthly basis” *215, but a public blockchain has no need to be audited

Proudly states that it’s the “first cryptocurrency to store KYC documents on its blockchain”216 except that it makes no sense and it also raises a huge security issue, especially when the “blockchain” will eventually go public (when 80% coins are “mined”) *217

Blockchain broken since mid-October 2016 - stuck on 863,570,000 coins *218

Conclusion: there’s no blockchain. Without a blockchain, there’s no cryptocurrency.

Let us now compare OneCoin with a real cryptocurrency:

*205 https://cointelegraph.com/news/keep-money-in-the-game-onecoin-moves-on-to-new-fantasy-blockchain

*206 https://www.facebook.com/photo.php?fbid=246015062467602&set=a.107251469677296.1073741828
.100011773291154

*207 https://www.youtube.com/watch?v=638_Jpp2Rq8 (Coin Rush Global Event, London, June ‘16)
*208 http://us9.campaign-archive2.com/?u=cf9659fd672fe664d487e7e1b&id=c5cc06fe8b (Newsletter: 3 Oct 2016)
*209 http://bravenewcoin.com/news/problems-with-big-numbers-in-crypto-how-bitcoin-dodged-a-bullet/
*210 http://bravenewcoin.com/news/big-numbers-dont-mean-big-money/
*211 https://en.wikipedia.org/wiki/Blockchain_(database)
*212 https://www.onecoin.eu/en/blockchain
*213 https://usa.visa.com/dam/VCOM/download/corporate/media/visa-fact-sheet-Jun2015.pdf
*214 https://kryptomania.zendesk.com/hc/de/article_attachments/201920261/AuditReport_June2015.pdf
*215 https://www.onecoin.eu/en/cryptocurrency
*216 https://www.onecoin.eu/en/blockchain
*217 http://www.slideshare.net/Onecoinplus/onecoin-secrets-revealed-2015-54053389
*218 https://www.onecoin.eu/tech/ (retrieved 16 Nov 2016)
Cryptocurrency - OneCoin

Decentralized - Centralized; under control of OneCoin

Finite supply - Supposed to be finite but increased by 5714%

Blockchain (distributed ledger) - No blockchain; Shutterstock video

Blockchain cannot be altered - “Moved” to new “blockchain”

Can be verified by anyone - Cannot be verified as it is closed/private

No 3rd party audit required; users Audit - Claims to be first to be audited by 3rd party

Open source - Closed source; no proof it exists

Mining - No proof of mining

User owns private keys - Owned and operated by OneCoin

User controls coins - OneCoin can confiscate coins

Wallet - No public wallet

Public Exchange - Private, internal exchange with restrictions




Conclusion: for a cryptocurrency to be legitimate, it needs to provide clear information, otherwise it cannot be trusted. From the above comparison, we can see that OneCoin is not a legitimate cryptocurrency.

What the experts say

Referring to experts in a field is crucial (as their opinion can be worth more than a thousand voices) and even more so in an industry in its infancy like cryptocurrency. Some examples (only a sample provided for the sake of brevity):

Bruce Fenton, ex-director of Bitcoin Foundation, declared OneCoin a “scam” in an interview *219 and also drafted a letter *220 to be signed by “a group of leading technical developers, business people, adopters, investors and others active in the field of blockchain technology and cryptocurrency” *221

Andreas Antonopoulos (technologist, expert and author of the 2 best-selling books on cryptocurrency *222) calls it a “pyramid” *223/”ponzi” *224 scheme and “one big scam” *225

Roger Ver, early Bitcoin investor and CEO of Bitcoin.com, calls it a “scam” *226


*219 https://cointelegraph.com/news/bruce-fenton-onecoin-has-no-value-when-it-collapses-regulators-will-blame-all-cryptocurrencies
*220 https://github.com/BruceFenton/letter-crypto/blob/master/Draft.md
*221 https://news.bitcoin.com/bruce-fenton-letter-onecoin/
*222 https://twitter.com/aantonop/status/799364048823418880
*223 https://twitter.com/aantonop/status/767732286112559105
*224 https://twitter.com/aantonop/status/803632462890823680
*225 https://twitter.com/aantonop/status/760237222322855937


Bob Summerwill, Ethereum developer, calls it a “pure scam” *227

Swedish Bitcoin Foundation labels it “a fraud” and “pyramid scheme” *228
Piotr Piasecki, Advisor for the Crypto Currency Certification Consortium, labels it a “Ponzi scheme” *229
Estonian Cryptocurrency Association calls it a scam *230
Both onecoin.eu and xcoinx.com appear on the BadBitcoin BadList *231
Digiconomist gave a “Really Bad” fraud risk assessment rating *232
Petteri Järvinen, computer scientist (MSc.), asks some “open questions” *233 and calls it a scam/pyramid scheme *234

Conclusion: it is not possible to find a single, reputable, independent expert in cryptocurrency who endorses and is willing to testify on behalf of OneCoin. On the other hand, experts (who have heard of OneCoin) are unanimous in declaring it as a Ponzi/pyramid scheme and not a cryptocurrency. This is significant as it conclusively proves that OneCoin is a fraudulent scheme.

Summary of findings

The above research has demonstrated an astonishing level of fraud and deception, broken promises, hidden lies, the founders’/leaders’ bad history, bad behaviour, incompetence, economic untruths and evidence that OneCoin is NOT a real cryptocurrency. With no cryptocurrency value and the education worth a fraction of the cost of the packages, there is no actual (or very little) value in the product being sold. Also noteworthy is that the education does not match the unanimous opinion of experts. Had the education been valid, members would reach the same conclusion. That they do not means that the education is invalid and not fit for purpose; therefore we are only left with recruitment without a product, i.e. a pyramid *235 or Ponzi *236 scheme. After establishing these facts, we can now move onto looking at the Islamic ruling.


Islamic ruling

Fraud, deception, lying, cheating and scamming are condemned in Islam. This also involves unlawfully consuming people’s wealth. A single verse and Hadeeth shall suffice:
لِطاِبْلاَِب مكُنَ يْ َب مكَُلاوَمَأْ اوُلكُْأَت لَ اوُنمآَ نيَذَِلا اهَُيَأ اَي

“O you who have believed! Do not consume one another's wealth unjustly” *237

" ماِعََطلا بَحاِصَ اَي اذَهَ امَ " لاَقَ َف ًلالَ َب ُهُعِباصَأَ تَْلانَ َف اهيَِف ُهدََي لَخَدَْأَف ماٍعََط ةِرَ بْصُ ىلَعَ رَمَ ملسو هيلع للها ىلص هَِللا لوَسُرَ نَأَ . ،ةَرَ ْيرَهُ يِبَأ نْعَ يِّنمِ سَيْلَ َف شَغَ نْمَ ساَنلاُ ُهارَ َي ىْكَ ماِعََطلا قَوْ َف ُهتْلَعَجَ َلاَفَأ " لاََق . هَِللا لوَسُرَ اَي ُءامَسلاَ ُهتْ َباصَأَ لاََق .

“It is narrated on the authority of Abu Hurairah that the Messenger of Allah (ﷺ) passed by a pile of food. He put his hand in it and his fingers were moistened. He said: ‘O owner of the food! what is this?’

*226 https://twitter.com/rogerkver/status/782606840282492929

*227 https://www.reddit.com/r/ethereum/comments/4wp0br/ethereum_dev_onecoin_is_a_pure_scam/

*228 http://www.bitcoinforeningen.se/blogg/varning-for-onecoin (Swedish)

*229 http://bravenewcoin.com/news/how-not-to-blockchain-a-look-at-onecoin/

*230 http://www.estoniantrader.com/onecoin-scam/

*231 http://www.badbitcoin.org/thebadlist/

*232 http://digiconomist.net/fraud-risk-assessment-onecoin

*233 http://pjarvinen.blogspot.co.uk/2016/06/onecoin-open-questions.html

*234 http://www.iltasanomat.fi/kotimaa/art-2000001028225.html (Finnish)

*235 https://en.wikipedia.org/wiki/Pyramid_scheme

*236 https://en.wikipedia.org/wiki/Ponzi_scheme

*237 an-Nisa’ 4:29

He replied: ‘It was rfood so that the people could see it? He who deceives is not of me (is not my Follower) *238
Let us now compare what happened in the incident mentioained upon, O Messenger of Allah’.
He said: Why did you not place it on top of the ned in the Hadeeth with OneCoin.

Many participants may not be aware, but the founders know
vs
Possible lack of knowledge ; seller perhaps didn’t know it was deception

Relatively minor loss to the buyer
vs
Huge losses; defrauding millions of People out of potentially billions of pounds

Simple buy/sell
vs
Elaborate fraud/scam

No intention to deceive; it happened to rain
vs
Clear intention to deceive from the founders/leaders; created with the express intention of running a scam

Nothing wrong with the terms and conditions
vs
The terms may be “Shari’ah- compliant”, but the product has no value

Restricted to single person at a time
vs
“Investors” become recruiters themselves to continue the fraud perpetually

Experts will know what to look for
vs
Relatively few experts/people with Knowledge in cryptocurrency

Those not experts could easily figure it out by placing hand inside
vs
A niche, technical subject, though the rest of the fraud is clear when explained

Still some benefit; receive less when dry
vs
No benefit (losses instead) especially for those who come later

Didn’t lie; omitted key information
vs
Plethora of examples of clear lies, deception, cheating and key information omitted too



As can be seen above, if the simple act of not informing (or showing) customers about the defect

is fraud and deception , OneCoin is far worse.

Participating in the OneCoin scheme involves fraud and deception which is impermissible
Based on the fact that it is unknown whether there will be anyone left to recruit (the only realistic means of earning money), it could be argued that the OneCoin scheme contains elements of maysir/qimar (gambling/chance ), gharar (uncertainty), jahalah (ignorance) and, additionally, assisting in sin/evil. We will not explore these aspects in this paper as what has been discussed

above is sufficient to reach a conclusion.

Conclusion

The OneCoin scheme contains fraud and deception leading to unlawful consumption of wealth which is impermissible. If potential recruits were made aware of the truth, they would be very unlikely to participate (except for the greedy and ignorant). Even if we ignore that aspect, we cannot escape the fact that when it collapses, it will cause harm to oneself and to one’s wealth which is impermissible. Additionally, by recruiting others, one causes harm to others

رد احملتار على الدر املختار: كتاب البيوع, بَابم الَْب يْعي الْفَاسيدي *240
241 al-Isra’ 17:26-27*

242 Sahih Muslim 593, 1715, Sahih al-Bukhari 2408, 1477 243 Muwatta 2/746, Sunan ibn Majah 2340/1, Dar Qutni 4/228 244 Sahih Muslim 2564, Sunan Abi Dawud 4882, Jami` at-Tirmidhi 1927, Sunan Ibn Majah 3933

which is also impermissible and this can continue indefinitely until collapse. This is further exacerbated by additional elements of interest, excessive uncertainty and gambling. We should not associate ourselves with such disreputable companies which cause harm.

Final conclusion: it is impermissible to participate in this scheme.

Source:

And Allah knows best

(Abu Yousuf) M. Suhail Patel, Bolton, UK

16 November 2016 / 16 Safar 1438

Approved and endorsed by

Mufti Amjad Mohammed, Principal of Markaz al-Ifta, The Olive Foundation & IRTIS, Bradford, UK Mufti Abdurrahman Mangera, Director of Zamzam Academy & Rayyan Institute, London, UK

Mufti Faisal Niazi al-Mahmudi, fatwa.ca, Qafila.org, Principal of ilmHub, Montreal, Canada

Shaykh Yusuf Shabbir, www.nawadir.org, Hadith Lecturer, Jaame Masjid, Blackburn, UK

Please note: further endorsements are pending and will be added as and when received, insha Allah

Acknowledgements

I would like to express my gratitude to all those who kindly offered their constructive comments, valuable feedback and guidance.
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