The U.S. Securities and Exchange Commission (SEC) has charged Alexandre Konanykhin, founder of Unicoin, along with two former executives, with securities fraud in connection with a scheme that allegedly defrauded more than 5,000 investors of approximately $110 million. Konanykhin gained notoriety in February 2022 for posting a $1 million bounty on Russian President Vladimir Putin, calling for his arrest as a war criminal.
SEC Allegations: Inflated Asset Backing
In a complaint filed with the U.S. District Court for the Southern District of New York, the SEC accuses Konanykhin, former Unicoin president Silvina Moschini, and former chief investment officer Alex Dominguez of misleading investors by claiming Unicoin tokens were backed by "billions of dollars of real estate and equity interests in pre-IPO companies." The regulator alleges that the actual value of the underlying assets was minimal. The SEC also claims the company falsely told investors it had raised $3 billion from token sales, while the real figure was closer to $110 million. "We allege that Unicoin and its executives exploited thousands of investors with fictitious promises that its tokens would be backed by an international portfolio of valuable real estate holdings," said Mark Cave, associate director at the SEC. "But as we allege, the real estate assets were worth a mere fraction of what the company claimed."
Founder's Background: From Oligarch to Fugitive
Konanykhin, a 58-year-old Russian native, has a long history of legal troubles. He was a former KGB-era banking oligarch who amassed a $300 million fortune by age 25 and became a member of former Russian President Boris Yeltsin's inner circle. In 1992, he claimed he was kidnapped by the KGB during a business trip in Hungary and escaped to the United States, where he filed for asylum. He was jailed twice for violating U.S. immigration laws but eventually won the right to remain. He then rebuilt his career, launching several startups, including Transparent Business, which produced the reality TV series Unicorn Hunters, featuring celebrity investors like Apple co-founder Steve Wozniak and former U.S. Treasurer Rosa Rios.
The Unicoin Project: Celebrity Endorsement and False Claims
Unicoin was created in 2022, and marketed as a cryptocurrency that would own equity in startups featured on the show and real estate, paying dividends to token holders. The company aggressively promoted the token via TV, social media, taxis, and airports, claiming it was registered with the SEC—a claim the regulator denies. The SEC investigation found that Unicoin's actual asset backing was negligible. Konanykhin responded on X (formerly Twitter): "The SEC's allegations are blatantly false. We intend to prove in court that they constitute yet another case of gross abuse of power."
Industry Impact and Next Steps
This case underscores ongoing risks of fraud in the cryptocurrency space. The SEC is seeking permanent injunctions, disgorgement of ill-gotten gains, and civil penalties. If convicted, the defendants could face further criminal penalties. The token's value has plummeted since the announcement. The case is ongoing.