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Blockchain myth-busters: It's not just about bitcoin

Mark Scott splashed his cash on yachts, pricey homes, fast cars and fancy watches – but his luxurious lifestyle was built on a huge cryptocurrency scam, a court has heard.

Mr Scott was a partner at prestigious US law firm Locke Lord before quitting to focus on his crypto dealings.

But he was later accused of using a variety of shell companies, overseas bank accounts and dodgy investment funds to cover up the source of $US400 million ($A588 million) he allegedly helped launder.

That cash was from Ruja Ignatova, a Bulgarian woman behind the OneCoin cryptocurrency system dubbed the “cryptoqueen”.

However, Assistant US Attorney Nicholas Folly claimed OneCoin was actually a fraudulent Ponzi scheme, raising billions from eager international investors who believed they were investing in a new digital currency.

In legal documents seen by news.com.au, it was alleged the lawyer laundered $US400 million ($A588 million) from 2016 onwards.

“OneCoin used the success story of Bitcoin to induce victims to invest under the guise that they, too, could get rich through their investments,” New York State lawyers said in one filing, according to the BBC.

“This was, of course, completely false because the price of OneCoin was a fiction and not based on supply and demand.”

Legal documents state Mr Scott and others “knowingly did combine, conspire, confederate, and agree together and with each other to commit money laundering” and that they did so “knowing that the property involved in certain financial transactions represented the proceeds of some form of unlawful activity”.

The documents state Mr Scott took part in “financial transactions which in fact involved the proceeds of specified unlawful activity, to wit, approximately $400 million in proceeds of a pyramid scheme involving a purported cryptocurrency known as OneCoin”.

According to Bloomberg, Mr Scott committed the alleged crime because he was inspired by a “50 by 50” goal – to make $US50 million ($A73.6 million) by the age of 50.

The 51-year-old was allegedly paid that sum to process Ms Ruja’s money.

“This is what Scott desperately wanted and this is what motivated him to commit these crimes,” Mr Folly said.

He used the proceeds to snap up a slew of luxury items, including three Porches.

“The scheme raked in billions of dollars in dirty money,” lawyer Julieta Lozano said in court earlier this month, according to Bloomberg.

“It was the defendant’s job to clean that money.”

But Mr Scott’s lawyer, Arlo Devlin-Brown, argued his client did not know the OneCoin cash was illegal, arguing he believed he was running a legitimate investment fund.

However, Mr Scott has just been found guilty for his role in the fraud.

Ruja Ignatova’s brother Konstantin Ignatov recently pleaded guilty to several charges related to his involvement in OneCoin, including money laundering and fraud.