38Aladdin Review: Chinese ecommerce ruse Ponzi scheme
38Aladdin represents itself to be a Chinese company operating as a subsidiary of 38Fule.
ALADDIN SHOP operates as a subsidiary of 38 Fule Technology Group, a prominent participant in the health and wellness industry known for its exceptional product quality and innovation.
38Fule is an actual company that sells various health and wellness products.
As tracked by SimilarWeb however, 38Fule’s website traffic is dead. The company’s official FaceBook page was abandoned in November 2018.
As far as I can tell, 38Fule is a dead company.
38Fule was founded by Yuan Xiaofeng, who appears on 38Aladdin’s website:
38Aladdin’s website domain (“38aladdin.shop”), was privately registered on February 9th, 2023.
I can’t say for sure but it appears Xiaofeng’s likeness has been misappropriated. Xiaofeng features in some 38Aladdin marketing videos, but this appears to be old stock footage that predates 38Aladdin.
David Hillhouse is an actual person too. Earlier this year in an interview with Eye Shenzen, Hillhouse revealed he’s a US actor from California who migrated to China in or around 2017.
Aside from acting, Hillhouse runs an electronics company in Shenzhen. He finds the city a livable city for expats.
“Shenzhen is a nice place. There are always good shopping malls, and there’s good quality food every place I’ve been to in Shenzhen,” he said.
Eye Shenzen credited Hillhouse with playing “chief commander in the technology center” in the January 2023 film The Wandering Earth 2.
I tried verifying Hillhouse’s role but it was too minor to show up on IMDB’s full cast list.
Whatever the case, Hillhouse is an actor playing CEO of 38Aladdin. This ties in with the potential misappropriation of Yuan Xiaofeng.
As opposed to Xiaofeng, Hillhouse appears in 38Aladdin marketing videos.
Hillhouse at the very least knows he’s fronting a bogus company.
One last thing to note is, despite 38Aladdin’s representation of being a Chinese company, its official FaceBook page is managed from Singapore.
Chinese scammers typically operate from Hong Kong of Singapore. And this again ties into an actor CEO and misuse of Xiaofeng’s likeness.
As always, if an MLM company is not openly upfront about who is running or owns it, think long and hard about joining and/or handing over any money.
38Aladdin has no retailable products or services within its MLM opportunity.
Affiliates are only able market 38Aladdin affiliate membership itself.
38Aladdin’s Compensation Plan
38Aladdin affiliates invest tether in “Genie Points”. This is done on the promise of a daily return of up to 1%.
- Basic – invest $50 to $4999 to and receive 0.5% a day
- Advanced – invest $5000 to $9999 and receive 0.75% a day
- Premium – invest $10,000 to $30,000 and receive 1% a day
Invested tether (as Genie Points) are able to be cashed out after 90 days. Withdrawal before 90 days is possible but 38Aladdin keeps a percentage of invested tether:
- withdraw between 1 and 30 days = 50% of invested tether returned
- withdraw between 31 and 60 days = 75% of invested tether returned
- withdraw between 61 to 90 days = 90% of invested tether returned
Note that 38Aladdin restricts withdrawals as follows:
- 10% has to be spent on garbage dropshipped products from China
- 30% is held to fund commissions
- 60% is available to be withdrawn
The MLM side of 38Aladdin pays on recruitment of affiliate investors.
38Aladdin Affiliate Ranks
There are three affiliate ranks within 38Aladdin’s compensation plan.
Along with their respective qualification criteria, they are as follows:
- Essential – recruit one affiliate investor
- Premier – recruit two affiliate investors
- Elite – recruit three affiliate investors
- One Star Elite – generate a downline of three hundred or more affiliate investors or generate 100,000 USDT in downline investment
- Two Star Elite – generate a downline of one thousand or more affiliate investors or generate 300,000 USDT in downline investment
- Three Star Elite – generate a downline of three thousand or more affiliate investors or generate 1,000,000 USDT in downline investment
- Four Star Elite – generate a downline of ten thousand or more affiliate investors or generate 3,000,000 USDT in downline investment
Note that for the purpose of rank qualification, no more than 50% of required downline USDT can be counted from any one unilevel team leg.
38Aladdin pays residual commissions via a unilevel compensation structure.
A unilevel compensation structure places an affiliate at the top of a unilevel team, with every personally recruited affiliate placed directly under them (level 1):
If any level 1 affiliates recruit new affiliates, they are placed on level 2 of the original affiliate’s unilevel team.
If any level 2 affiliates recruit new affiliates, they are placed on level 3 and so on and so forth down a theoretical infinite number of levels.
38Aladdin caps payable unilevel team levels at ten. Residual commissions are paid as a percentage of daily returns paid out to affiliates across these ten levels as follows:
- Essential ranked affiliates earn 20% on level 1 (personally recruited affiliates)
- Premier ranked affiliates earn 20% on level 1 and 10% on level 2
- Elite ranked affiliates earn 20% on level 1 and 10% on levels 2 and 3
- One Star Elite ranked affiliates earn 30% on level 1, 10% on levels 2 and 3 and 5% on level 4
- Two Star Elite ranked affiliates earn 30% on level 1, 10% on levels 2 to 5 and 5% on level 6
- Three Star Elite ranked affiliates earn 40% on level 1, 10% on levels 2 to 6 and 5% on levels 7 and 8
- Four Star Elite ranked affiliates earn 50% on level 1, 10% on levels 2 to 8 and 5% on levels 9 and 10
Rank Coded Bonus
38Aladdin pays a Rank Coded Bonus on downline daily returns earned of up to 50%.
- One Star Elites receive a 15% Rank Coded Bonus
- Two Star Elites receive a 30% Rank Coded Bonus
- Three Star Elites receive a 40% Rank Coded Bonus
- Four Star Elites receive a 50% Rank Coded Bonus
The coded nature of the bonus sees a 50% match paid out on daily returns paid out.
If you were a Four Star Elite and had a Two Star Elite below you, they’d be paid 30% and you’d collect your 50% plus 20% of what wasn’t paid to them.
In this manner, upline higher ranked 38Aladdin affiliates are able to receive the difference between 50% and the payout of lower ranked One Star Elites and higher below them.
38Aladdin takes 50% of invested tether and uses it to fund Global Rewards.
The 50% Global Rewards Pool is broken down into four smaller rank-based pools as follows:
- One Star Elites receive a share in a 10% Global Rewards Pool
- Two Star Elites receive a share in a 20% Global Rewards Pool
- Three Star Elites receive a share in a 30% Global Rewards Pool
- Four Star Elites receive a share in a 40% Global Rewards Pool
Rank Achievement Bonus
38Aladdin rewards affiliates for generating downline investment with Rank Achievement Bonuses.
Note that Rank Achievement Bonus ranks are separate to affiliate ranks.
- Bronze – generate 100,000 USDT investment outside of your largest unilevel team leg and receive 5000 USDT
- Silver – generate 300,000 USDT investment outside of your largest unilevel team leg and receive 15,000 USDT
- Gold – generate 1,000,000 USDT investment outside of your largest unilevel team leg and receive 50,000 USDT
- Platinum – generate 2,500,000 USDT investment outside of your largest unilevel team leg and receive 130,000 USDT
- Diamond – generate 5,000,000 USDT investment outside of your largest unilevel team leg and receive 300,000 USDT
- Meteorite – generate 10,000,000 USDT investment outside of your largest unilevel team leg and receive 500,000 USDT
Note that downline investment criteria must be met for 30 consecutive days before Rank Achievement Bonuses are paid out (i.e. active investment is counted, not investment that has been withdrawn).
38Aladdin affiliate membership is free.
Full participation in the attached income opportunity requires $50 to $30,000 investment in tether (USDT).
38Aladdin is an obvious Ponzi scheme, appearing to be run by Chinese scammers operating out of Singapore.
38Aladdin’s ruse is ecommerce. I think this is a lazy attempt at association with Alibaba. The whole setup is a bit of a pisstake really, 38 Fool anyone?
Obviously the ecommerce platform presented on 38Aladdin’s website has nothing to do with their investment scheme.
It’s a simple ecommerce template website running an “eShop” template.
On the backend, 38Aladdin affiliates invest tether on the promise of a passive daily return. Attached to this is a pyramid scheme, as without constant new investment 38Aladdin collapses.
Everything from the use of Genie Points, withdrawal restrictions and locked up funds for 90 days, is designed to trap as much money in 38Aladdin for as long as possible. Again, this is indicative of it being a Ponzi scheme.
On the regulatory front, 38Aladdin fails to provide evidence it has registered its securities offering with financial regulators in any jurisdiction.
This means that, at a minimum, 38Aladdin is committing securities fraud. Securities fraud and Ponzi schemes go hand in hand.
As with all MLM Ponzi schemes, once affiliate recruitment dries up so too will new investment.
This will starve 38Aladdin of ROI revenue, eventually prompting a collapse.
The math behind Ponzi schemes guarantees that when they collapse, the majority of participants lose money.