Degen Protocol Review: Drip Network spinoff Ponzi
Degen Protocol provides no information on its website about who owns or runs the company.
Degen Protocol’s website domain (“degenprotocol.io”), was privately registered on November 11th, 2021.
A YouTube link provided on Degen Protocol’s website takes us to a channel belonging to “Crypto Black Sheep”.
Crypto Black Sheep is the alias of Christopher Mason.
According to his LinkedIn profile Mason sees himself as a musician. Before becoming a crypto bro, Mason worked as an assembly line worker.
A due-diligence document, put together by someone with far more patience for blockchain bullshit than myself, names “Shane M” as Degen Protocol’s other co-founder.
Shane appears on Mason’s “The Blacksheep Show” YouTube videos as “Island Boy Shane”.
According to the document, both Mason and Shane M are based out of Las Vegas, Nevada in the US.
The document goes into specific detail about who the early adopters and promoters of Degen Protocol are.
There are a number of familiar faces, some of whom have a history of association with documented MLM Ponzi schemes.
As to the founding of Degen Protocol, this part of the document is of interest:
We learn here that Degen Protocol is a spinoff of Drip Network. A continuation of crypto Ponzi fraud that seems to date back a number of years.
For reference “clovercrypto” referenced above is Calen Powell (right). Powell was a top promoter and earner in the BitConnect Ponzi scheme.
Powell was in southeast Asia during BitConnect’s run. After the multi-billion Ponzi collapsed, Powell fled to South America.
The DOJ has begun indicted BitConnect insiders. The SEC has sued several top promoters.
In 2018 Powell was picked up and interrogated by the FBI. Whether he’s currently a person of interest to US authorities is unclear.
Powell is currently in Peru. He periodically uploads crypto videos to his “Clover Crypto” YouTube channel.
In summary, Degen Protocol was founded by serial crypto Ponzi scammers based out of the US. Early Degen Protocol adopters and promoters are also serial Ponzi scammers.
Read on for a full review of Degen Protocol’s MLM opportunity.
Degen Protocol’s Products
Degen Protocol has no retailable products or services.
Affiliates are only able to market Degen Protocol affiliate membership itself.
Degen Protocol’s Compensation Plan
Degen Protocol affiliates invest in SH33P tokens on the promise of an advertised passive return.
The return is 3% of funds invested in Degen Protocol, paid out pro-rata based on how much a Degen Protocol affiliate has invested.
If an affiliate opts to convert their SH33P tokens to WOOL tokens, they can participate in a 1% a day investment scheme.
There’s a bunch of other nonsense investment schemes within Degen Protocol, we’ll cover those in the conclusion of this review.
The MLM side of Degen Protocol pays on recruitment of affiliate investors.
Degen Protocol 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.
Degen Protocol caps payable unilevel team levels at fifteen.
Unlocking each unilevel team level requires 10 SH33P tokens be invested.
To fully participate in the MLM side of Degen Protocol, affiliates must invest at least 150 SH33P tokens.
Once qualified for, referral commissions are paid out as a percentage of SH33P invested across the unilevel team.
Note Degen Protocol don’t disclose referral commissions percentages paid out.
Joining Degen Protocol
Degen Protocol affiliate membership is free.
Full participation in the attached MLM opportunity requires a 150 SH33P token investment.
Degen Protocol Conclusion
Degen Protocol is multi-layered MLM crypto Ponzi scheme. And not in a remotely clever way.
The general theme of Degen Protocol is sheep, representing Christopher Mason’s “Crypto Black Sheep” alias.
To that end you have SH33P, XSH33P, WOOL and FLOCK tokens – all of which are CRC-20 tokens.
CRC-20 is the Cronos Chain equivalent of the more common ERC-20 and BEP-20 shit tokens. These all take a few minutes to set up at little to no cost.
As to Degen Protocol’s various Ponzi schemes, you have SH33P and XSH33P:
People holding SH33P can stake their SH33P as XSH33P into the staking pool to earn passive $SH33P rewards from transaction fees collected by trading activity.
Users can deposit their XSH33P to earn rewards from both the instant and drip dividend pools.
Then there’s the WOOL Ponzi;
The “Woolshed” contract was inspired by the Drip Network.
The Woolshed will (allow) … users to exchange their tokens for “WOOL”, which can be deposited to receive up to a consistent 1% daily return (365% APR).
And finally “The Barn”, build around FLOCK:
By depositing $SH33P into the Barn, player’s [sic] can help harden the price of $WOOL and also earn passive $SH33P rewards.
It’s all quite stupid sounding but under the hood all withdrawals are paid out invested crypto.
The daily dividend pool drips out 3% of it’s [sic] balance to all players per day.
Across all its Ponzi schemes, Degen Protocol is a closed-loop system with no external revenue source.
Looking forward, Degen Protocol will cap things off with an NFT launch.
During Q1 2022, there will be a total of 2015 SH33P NFTs for sale.
By holding a SH33P NFT, not only will you generate a fixed amount of $WOOL daily, but you will also receive additional $SH33P rewards.
This is of course another Ponzi scheme front:
Q1 2022 ends in less than a fortnight. No idea if SH33P NFTs launched, it doesn’t really matter.
As with all MLM Ponzi schemes, the majority of funds invested into Degen Protocol will be stolen by the admins and early adopters/promoters (see due-diligence chart).
According to Degen Protocol’s “woolpaper”, these scammers have 25% of SH33P tokens off the bat. Plus whatever blockchain bro bullshit deals they work out among themselves.
You as an investor are “playing” against a stacked deck, in addition to the mathematical certainty that the majority of investors in Ponzi schemes lose money.
Seeing as Degen Protocol is being run by Drip Network scammers who acknowledge it as the inspiration behind the scheme, here’s how their DRIP token Ponzi scheme is going:
Drip Network experienced a recruitment boom in late 2021. This coincides with DRIP token pumping.
As you can see recruitment has slowed and early investors have withdrawn crypto invested during the recruitment boom. Unless new victims are found, DRIP token will continue to dump towards $0.
Being a near identical set of Ponzi schemes, Degen Protocol will eventually collapse in the same manner.
As per the SH33P token chart above, it’s already happening.