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The Australian regulator responsible for overseeing securities has warned investors to steer clear of OneCoin, after officially labelling project a “scam.”

The Australian Securities and Investment Commission (ASIC) warned the public in a notice released this week that it suspected OneCoin “could be involved in a scam.”

The warning is the starkest to date to come from the regulator concerning OneCoin, with potential investors advised to avoid dealing with the company. According to the regulator, OneCoin is operating on an unregulated basis, and without a license in Australia.

Similar to previous warnings issued by the Commission concerning other projects, the regulator said OneCoin has failed to secure the two licenses required to legally offer investment services in the country.

In order to operate legitimately, the regulator said the firm would require both an Australian Credit License and an Australian Financial Services License. According to a press release, the regulator identified the company as being based in Sofia, Bulgaria.

Founded back in 2014, OneCoin has been labelled by some commentators as a classic Ponzi scheme. The company is reported to have raised $3.8 million from investors by promise low risk, high reward investments.

While a senior official at the firm has been arrested in recent weeks, the company apparently continues to trade, and was still live as of March.

Earlier this month, an investor in OneCoin brought legal proceedings against a number of people and entities linked to the project, which was described as fraudulent.

These include brother and sister team Ruja and Konstantin Ignatova, with both facing charges including wire fraud and money laundering. Konstantin Ignatov has already been arrested in connection.

The verdict from the Australian regulator should help dissuade some more unsuspecting investors from falling for OneCoin’s marketing. Rather than high returns, investors have been faced with significant difficulties in realizing these promises.

With the ASIC taking a robust approach to shutting down cryptocurrency scams, the regulator sets an example to others worldwide fighting their own battles with crypto scammers.

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