You are correct, it was an investment scheme. In the tax law both are discussed together in the Form 4684 instructions. If you gave it away and it's less than $19,000 there is nothing to report. If this is simply an investment loss you can report it as such.
It's possible it would be considered as a worthless investment as long as you have the records to show your total investment and when it became worthless.
Based on your description, it seems like your invested funds were stolen in which case the original answer would apply. It's completely up to you if you want to include this in your tax return.
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