How Uganda became a hotbed for cryptocurrency scams

OneCoin, a global scam worthy of a Hollywood blockbuster, fooled many Ugandans. Other scams have since followed, illustrating the mad rush to fake crypto-currencies in Africa.

Daniel Leinad Turyasingura imagined himself “going to university, driving a car.” In other words, affording everything he dreamed of. And with good reason: in 2016, this high school student from a small rural Ugandan town had the chance, thanks to a friend, to invest very early in a cryptocurrency that was about to dominate the world. “OneCoin promised to replace all other currencies, it was the future of payments. We all saw it as a paradigm shift,” said the 26-year-old, who lives in a tidy house in the capital Kampala. At the time, bitcoin, another revolutionary “crypto,” was starting to gain recognition in the country. But OneCoin promised to be bigger and stronger.

Daniel pooled his savings and sold three of the family’s goats to buy a “bundle” of 700,000 Ugandan shillings (around €168), giving him around 700 OneCoins that would soon be worth a small fortune. His father also bought a bundle, as did an uncle they dragged into the venture – which earned them a small recruitment bonus (less than €2), but also showed their magnanimity: “We couldn’t let him die in poverty, it was an opportunity.”

The OneCoin frenzy was then at its height. Its charismatic founder, Ruja Ignatova, a Bulgarian businesswoman, had been traveling the world for two years, converting thousands of people to her financial revolution at major conferences, sold as inclusive and unifying. “One coin, one family!” she would exclaim on stage, richly adorned and her lips painted a deep red, as recounted by the BBC in the fascinating podcast The Missing Cryptoqueen. Her team claims that Ignatova, a former McKinsey consultant, helped develop bitcoin and close its loopholes to create “the perfect currency.”