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Escape MLM Crypto Schemes: Avoid Unrealistic Returns And Recruitment Traps

Escape MLM Crypto Schemes
Avoiding MLM crypto schemes will help you protect yourself from unrealistic returns and recruitment traps.

In a world buzzing with the promise of extraordinary gains and futuristic technologies, the realm of cryptocurrency has captured the imagination of many. However, amidst the genuine opportunities lies a shadowy realm of fraudulent schemes that exploit the growing interest in crypto.

As the allure of quick riches intensifies, so does the prevalence of scams that prey on the uninformed and greedy, making it imperative for investors to stay vigilant and informed. This blog unveils the stark reality of MLM (Multi-Level Marketing) crypto schemes, shedding light on their tactics of luring unsuspecting investors with unrealistic returns and recruitment allure.

Understanding MLM Crypto Schemes

What is MLM in Crypto?

MLM, also known as network marketing, involves participants investing in a cryptocurrency scheme and then recruiting others to join. This creates a network of investors, each with the potential to earn not only from their own investments but also from the investments of their recruits.

MLM in the crypto world is like a chain where people invest in a cryptocurrency plan and bring in more people to invest as well.

As these new investors join, the original ones can earn money not just from what they put in but also from what their recruits invest. MLM in the crypto space often promises impressive returns and passive income, making it appealing to those seeking quick profits.

However, it’s important to be cautious because while it might seem like an easy way to make money, it can also be risky, and people should be careful before getting involved.

How MLM Operates in Crypto

  • Investment tiers: You’re asked to invest different amounts for different returns. The more you invest, the more you’re promised to make.
  • Recruit others: You’re told to bring in more people to join. When they invest, you get a piece of their money as a reward.
  • Earnings from downline: As your recruits bring in more people, you keep getting a share of the money they invest. This can grow fast if your network gets big.
  • Promoting tokens or products: You’re given a cryptocurrency token or product to promote. Your earnings depend on how well it’s promoted.
  • Focus on growing quickly: MLMs want a large number of people to get involved fast since more people mean more earnings.


Note: Not all MLMs are bad, but you need to be careful. Do your research, talk to people you know, and be cautious before you put your money and time into these kinds of things.

Red Flags of MLM Crypto Schemes

Crypto Ponzi schemes need you to invest in digital money, while crypto MLM schemes want you to pay a fee, buy digital money, and get others to join. Here are more signs of these schemes in the crypto world:

1. They promise huge and steady profits, even though cryptocurrencies can be quite volatile.
2. They market it as a scheme with little or no risk, which is usually too good to be true.
3. If the people behind a crypto project are secret, it could be a scam.
4. If a crypto company does big, flashy ads, they might be tricking you.
5. These scams often come from places without licences or rules.
6. The companies making these scams usually make things confusing, with lots of fees and rules.
7. They might not have proper info, like plans or explanations.
8. Anyone can join without any special requirements.
9. If you can’t take out your money or they keep saying to put more in, it’s bad news.
10. There could be mistakes in your money statements or how much they say you’ll get.

Real-life examples

BitConnect Fraud

Bitconnect was a notorious MLM scheme that operated within the cryptocurrency space. It promised unbelievably high returns to its investors through a lending program. The entire setup was revealed to be a fraudulent Ponzi scheme, where returns to earlier investors were paid using the investments of newer participants rather than through legitimate profits.

This unsustainable model eventually collapsed in early 2018, causing significant financial losses for countless individuals who had invested in Bitconnect.

Participants were encouraged to invest their cryptocurrencies in Bitconnect and, in return, were offered substantial profits. The way it worked seemed enticing. Investors would lend their funds to the platform, and Bitconnect claimed to use a trading bot that would generate profits for them.


OneCoin was a well-known MLM scheme that claimed to be a cryptocurrency investment opportunity. It promised big profits through its trading platform and encouraged people to invest and recruit others.

However, investigations later revealed that OneCoin was a fraudulent scheme with no real blockchain or cryptocurrency. OneCoin marketed itself as an educational platform selling different levels of cryptocurrency education packages.

These packages supposedly contained information about blockchain technology and cryptocurrency trading. Investors were told that by purchasing these packages, they would receive OneTokens that could be “mined” and would increase in value over time.

People were lured in by the promise of high returns, but the scheme eventually collapsed, leaving many investors with significant losses. This serves as a cautionary tale about the importance of doing thorough research and being cautious of schemes that promise unrealistic gains in the crypto world.

Social media played a crucial role in the promotion of both schemes. BitConnect and OneCoin utilised platforms like YouTube, Twitter, and Facebook to share success stories, testimonials, and information about their projects. They created a sense of urgency and excitement by highlighting individuals who claimed to have made significant profits, enticing others to join in.

How to Protect Yourself

  • Before you invest in any crypto, do your homework. Read their info, trusted news, and what others say about them.
  • Know who’s in charge of the project. Check if people like them and if they’re well-known.
  • Be careful with big profit promises.
  • Be cautious if you get unexpected offers to join. They might be trying too hard to get you.
  • Make sure they’re allowed to do what they do. Look for licences and certificates. For DeFi projects, check if they got checked by experts.
  • Don’t risk too much. Have a plan, and don’t invest all your money, even if they say you’ll get rich.

Protecting Loved Ones from MLM Crypto Schemes: Share Awareness

If you’re lucky, you can withdraw some of your investment before the scheme unravels. After regaining your assets, or even if you can’t regain them by spreading awareness about MLM crypto schemes, you play a vital role in ensuring their financial well-being.

Share reliable sources of information about cryptocurrencies and investments. Misinformation can easily lead to poor decisions, so it’s crucial to rely on well-established platforms. Share educational resources, insightful articles, and trustworthy information on your social media platforms to empower others to steer clear of these pitfalls.

Legitimate Investment Alternatives

Investing in cryptocurrencies can be both exciting and profitable, but it’s important to approach it wisely. Here are some legitimate ways to invest in cryptocurrencies, along with reputable tools and exchanges to consider:

  1. Reputable exchanges:
    Trusted cryptocurrency exchanges provide a secure platform to buy, sell, and trade cryptocurrencies. Look for exchanges with a strong reputation, user-friendly interfaces, and robust security measures.
  2. Established coins:
    Investing in well-established cryptocurrencies can be a more stable option. These coins have a proven track record and are less likely to be associated with scams.
  3. Long-term investment strategies:
    Long-term investing involves holding onto your chosen cryptocurrencies for an extended period, allowing them to potentially appreciate in value over time.
  4. Research and education:
    Before investing, take the time to research and understand the cryptocurrencies you’re interested in. Learn about their use cases, technology, development teams, and market trends.

Remember, the key to successful cryptocurrency investing is patience, research, and risk management. While the crypto market can be volatile, making informed decisions and using reputable tools and platforms can help you navigate it safely and potentially achieve your investment goals.

Diversification of a crypto portfolio is crucial because it helps mitigate risks associated with the volatile cryptocurrency market.


In conclusion, the dangers of MLM crypto schemes are significant and can lead to financial loss and disappointment. By educating yourself and being vigilant, you can protect your hard-earned money from falling prey to these deceptive schemes. 

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