Randy Gage one of my mentors in the network marketing wrote an article that is going to bring clarity if you are in the process of taking the decision to join or not a Cryptocurrency Multi-level Network Marketing
5 Questions to Ask Before You Join an MLM Cryptocurrency Program…
Since my Manifesto, R.I.P. MLM was released, the discussion on MLM cryptocurrency programs has moved into overdrive.
But that is not stopping more deals from springing up! And the new ones are even more sophisticated that the earlier ones.
I’ve been trying to figure out the analogy that best matches what is happening in the crypto space now, and I finally figured it out: The “cocaine cowboys” days of Miami in the 80s. Since that ended up with me taking a bullet in the gut, I’m hoping for a better outcome this time around!
So I’m taking the next step of posting another warning about the cryptocurrency deals presenting themselves as network marketing programs.
I believe there are five pretty basic questions you can ask, which can immediately weed out the questionable proposals. Here they are:
- Is the blockchain programming open and published? And been verified by an independent cybersecurity audit?
(If the answer is no to either of these, you can stop here and move on.) I’m just looking at the website of the latest “hot” crypto deal that is storming social media right now. Their “whitepaper,” which is where legitimate cryptocurrencies usually their programing code, is actually a sales letter. It’s filled with hype like “bitcoin on steroids,” and what appears to be “cut and paste” copy plagiarized from authentic companies.
- Is there an actual eco-system?
Meaning, that the token or coin they offer can actually be used as currency. You should be able to transfer it into another currency such as the dollar, yen, pound, etc. And there needs to be actual places you can spend the currency. (And no, this doesn’t mean a website set up by the founders where they offer their knitted sweaters, one restaurant their sister owns, and their mother’s hair styling salon.) It means real vendors, businesses, and people who are not participants in the money game that accepts the cryptocurrency.
- Are they located in a first-world country with real consumer regulatory protection in place?
When a company tells you they are operating in offshore states because they believe other country’s regulations are too “onerous,” – are they simply trying to operate in a haven with less chance of going to prison? Ask yourself what would happen if they stole all of your money. Would you have any legal recourse in that country?
- Are there laws in your country that regulate, certify or license people who promote investment opportunities?
In many countries, promoting currency or forex investing options without accreditation and licensing will get you a trip to prison.
- Do the promoters guarantee returns?
If they do, of any amount or percentage, run away immediately!
If you begin your due diligence by asking these five questions, it’s a pretty safe bet you will eliminate 99 or even 100% of the companies claiming to be MLM cryptocurrency programs.
And provided you find one that somehow passed these questions, my personal opinion is that forex trading and cryptocurrency investing are not appropriate products for network marketing anyway.
Full Disclosure: I am not “anti-crypto” or on a vendetta against cryptocurrencies, as some people are suggesting.
People who follow my work know I predicted the rise of cryptocurrencies back in 2012, in my New York Times bestseller, Risky Is the New Safe.
In fact, I have invested in cryptocurrencies and continue to hold some in my portfolio.
Personally I categorize cryptocurrencies in the High Risk/High Reward segment of my portfolio.
I do believe one currency will ultimately shake out as the market matures and become the accepted alternative to fiat currencies. (And just for you guys who are going to ask,
I don’t actually believe it will be Bitcoin.)
In my opinion, cryptocurrencies have a dramatically higher risk than precious metals, because of the potential dangers of hacking, insider manipulation, and electromagnetic pulse warfare.
Any one of these three scenarios could wipe out an entire cryptocurrency (or all of them) instantly.
So borrowing money to invest, or investing money you cannot afford to lose is a very bad idea in this sector.
Please don’t invest without consulting with your certified financial or investment advisor.
And if the cryptocurrency you’re investing in is being promoted by a network marketing pay plan, I think it’s a foolish idea that will victimize a lot of innocent people.
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