How to Avoid MLM Cryptocurrency Scams?
In the past few years, there has been a flood of multi-level marketing cryptocurrency coins or tokens.
Everyone talks about big profits in cryptocurrency-based multi-level marketing. But are they worth giving a big profit?
Many people become victims of such fake promises, but in the end, everyone is left with no option but to lose their money.
That is why it is important to know a few things to invest in MLM cryptocurrency so that no one will be able to scam you.
Many MLM companies focus only on having a large community or a small number of coins and keep on tricking people. So that people feel that due to having a community of millions or only by reducing the number of coins, it will increase the rates of cryptocurrency which is completely wrong.
There are many other factors that can affect or benefit the rates of cryptocurrency. Unless these factors are understood, the coins promoted by Multi-Level Marketing will prove to be "bubble-like behavior".
We will try to understand many such factors in this article and also understand how any token promoted through MLM cannot run for the long term. With many such examples, we will try to bring many such facts to the fore.
The most important role in increasing the rates of any cryptocurrency token is the demand and supply ratio!
It is absolutely true that if demand is high and supply is low, then it is natural for rates to rise. This rule applies to any type of trading.
But when many MLM companies start selling coins, they only focus on the short supply of tokens. But they do not have any way to increase the demand.
In my own opinion, the demand for the token will increase only when its utility increases. However, most MLM companies are "sugar-coated poisons" because they either do not have the knowledge or infrastructure to increase the utility of the coin.
To increase the utility, the latest technology, along with better thinking is also needed.
Today, many cryptocurrencies like Bitcoin or Ethereum or Ripple have great utility, that is why their demand is increasing
For example, let's discuss the Solana coin. Last week, Solana became the world's biggest sixth cryptocurrency. This coin was launched in the year 2018.
In such a short span of time, Solana has competed with Ripple (XRP) and Solana is being seen as a competitor to Ethereum. In the last 40 days alone, the price of this coin has increased more than five and a half times.
The main reason behind the increase in these prices is Solana's technology, its transaction process speed, low transaction charges. Its blockchain technology attracts NFT and smart contract developers to build more and more applications on this blockchain.
Does any crypto-based MLM company have such technology? Just ask yourself this question...
...so is this only one reason why MLM coins/tokens don't last long?
Not at all, due to lack of smart technology, MLM tokens always lag behind in utility building.
The supply is also an important issue in which MLM coins get failed completely. Within a short span of 4-6 months the supply of MLM coins/tokens keeps on increasing and due to no plan to increase the demand, these coins start getting exhausted.
The more difficult the mining process for any cryptocurrency, the more limited its supply will be. There is no mining process of MLM coins like Platincoin or ECC. Those coins/tokens that do not reflect on the blockchain are duped by giving the technical coin the "sugar-coated" name.
The 600 million coins of Platincoin are said to be pre-mined, but there is no technical information about its actual process. 12 year aged Bitcoin is still being mined and Platincoin has mined 4 years ago.
That's why the supply of MLM coin goes too much in a short time and people lose their money.
Many big companies are increasing their investments in cryptocurrencies today to secure their money from market risk, hedging, and rising inflation rates. Listed companies like Paypal, Square, MicroStrategy have invested million of dollars in cryptocurrency.
Has any company made such a fundamental investment in MLM Coins/Tokens to date?
The answer is "ABSOLUTELY NOT".
Till we looked at the flaws of MLM Coins/Tokens. Now let's go ahead and try to understand the model of cryptocurrency-based MLM with the examples of some companies.
Platincoin
The demand and supply ratio is absolutely not maintained in Platincoin and it is not possible to maintain it. People have crores of coins lying with them and they cannot sell those coins. This is the reason why its rates have not increased for the last several years.
In the context of technology, Platincoin is definitely seen doing a lot of innovation in comparison to other MLM models, despite innovative ideas, there has not been much changed in 4 years' time.
Platincoin is such an MLM company that wants people to buy their coins, but this company does not buy its own coins. If you buy a package of Platincoin, then you have to buy from Bitcoin or USDT only.
Sometimes you can buy packages with Platincoin but the products you get, are of low quality. For example, if you want to buy Blockchain Places, then you cannot buy by paying through Platincoin.
There are so many factors that are incapable of giving the returns of your investment from Platincoin.
Etherconnect (ECC)
Etherconnect (ECC) is itself a scam model. Earlier, he had formed a company called Bitconnect in which many people in the world had lost their money.
Etherconnect (ECC) specializes in manipulating coin prices. Despite not having any base, they raise the price of tokens by artificial means and due to the increase in supply even a little, the rates have fallen drastically.
The same company has promoted a token named EIFI. Whose rates touched Rs 8000 per token. After the release of only 10% of the coins, their rates have gone down to Rs 20 per token.
One thing I have understood from Etherconnect (ECC) is that nothing happens just by having a big community. The ground reality is also important. If there is no utility, no technology, how will the token prices increase?
Earlier it was falsely claimed that the EIFI token would be launched on platforms like Binance. But it doesn't seem to be happening now. But it didn't matter much.
There are also some MLM coins that are on big platforms like Coinsbit, but due to a lack of strong infrastructure and utilities, they are of no value.से भी हैं जो Coinsbit जैसे बड़े प्लेटफार्म पर हैं लेकिन स्ट्रांग इंफ्रास्ट्रक्चर और यूटिलिटी नहीं होने की वजह से उनकी कोई कीमत नहीं हैं.
WYZth Token
WYZth Token is also being promoted through an MLM. As far as I know, this token was in the market even before it was launched in MLM. It was decided to launch this token in MLM only to build a big community.
The entire technology required for the growth of a token is already ready. Own blockchain has also been launched. Its founder wants to take this token to the big stage.
The most important thing is that its growth is completely organic. Along with better technology, it is also a utility token.
But if a better cryptocurrency token is to be successful then the waiting period should also be at least 2 to 4 years. You also need to have so much patience and a waiting period.
Due to the decentralized model of the WYZth, this token can prove to be a racehorse. If the technology development continues, then perhaps it can become a successful token despite being an MLM model.
StockUpex (STX) Token
StockUpex (STX) is a one-and-a-half-year-old token issued on the TRON blockchain. But the performance of this token in said time span does not look anything special.
Its founders claim to have developed technology, that has included exchanger, blockchain technology; But it doesn't seem like that. Till the time of writing this article on TRON Block Explorer, this token has only 37 transactions.
The company has listed its token on an exchange like Coinsbit but the trading volume is negligible.
There is also no information available about this token on CoinsMarketCap.
Apart from gaming, the company's focus on other utilities is not visible.
There is no attractive offer in the stacked coin earning. In 20 months only 20% extra benefit is available to the user.
Tokens gained from staking earnings cannot be swapped by the user, meaning it cannot be converted into other reputed cryptocurrencies.
Those who invest in this token should first check whether the tokens profit they are earning can be converted into cash or not...!
If an investor wants to recover his money by selling his tokens, he has to either reinvest, or the user can use only 50% of tokens to register a new person. (User must take cash from the newly joined person in exchange for the token).
Therefore, in the perspective of liquidity, then this token can become a future liability for you.
Apart from this, the trust score of the company is zero. The domain rating of the website is also very low.
Its reviews are also not available on Google or other search engines. And the most important thing is that the company has not even done Search Engine Optimization of its website. I do not know whether this was done intentionally or by mistake.
Overall, the behavior of StockUpex (STX) company does not look like a professional cryptocurrency company at all.
I wouldn't say it is a scam! Whether this is a scam or not, it will be proved in the coming time. But, I don't see any bright future in this.
Conclusion:
The conclusion of this article is that it is not at all possible to be successful as an investor in MLM-based crypto tokens or coins. Some MLM companies may be an exception. But most of the companies are scams that waste your money.
Do not waste your hard-earned money on such types of MLM companies!
If you are looking to invest in cryptocurrency, I would suggest keeping an eye on new tokens/coins launching on exchanges like Binance. Study it. Hold it. There will be no losses at all, you will get a profit only!
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