FirstCoin Club Review: Manipulating “public” trading for private profit
FirstCoin Club provide no information on their website about who owns or runs the business.
The FirstCoin Club website domain (“firstcoin.club”) was privately registered on July 15th, 2016.
The FirstCoin Club website cites “Dynamic Global Marketing Ltd” but provides no information about the relationship between the two companies.
An address in Dubai is provided, however further research reveals this address belongs to Freemont Group.
Freemont Group provide business formation services in Dubai, suggesting FirstCoin Club (and Dynamic Global Marketing LTD) exist in Dubai in name only.
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.
FirstCoin Club Products
FirstCoin Club has no retailable products or services, with affiliates only able to market FirstCoin Club affiliate membership itself.
The FirstCoin Club Compensation Plan
FirstCoin Club affiliates invest firstcoin with the company on the promise of a monthly ROI.
Referral commissions are paid when affiliates are recruited and also invest.
FirstCoin Club affiliates deposit firstcoin with the company and earn a passive 3% to 7.5% monthly ROI (paid in Firstcoin).
- Basic – invest $200 to $1999 in firstcoin and receive a 3% monthly ROI
- Silver – invest $2000 to $9999 in firstcoin and receive a 5% monthly ROI
- Gold – invest $10,000 to $24,999 in firstcoin and receive a 7.5% monthly ROI
- VIP – invest $25,000 or more in firstcoin and receive a 7.5% monthly ROI (plus 10% one-time bonus on amount deposited)
Dubbed “FirstCoin Advertising Mining Shares”, the more an affiliate invests the higher their monthly ROI.
FirstCoin Club pay a 10% referral commission on firstcoin deposited by personally recruited affiliates.
If an affiliate recruits five affiliates, from the sixth they earn a 20% referral commission rate.
A residual referral commission rate of 7.5% is paid on level 2 downline affiliates.
If a FirstCoin Club affiliate personally recruits ten or more affiliates who together have invested at least $5500 in firstcoin, they receive a share in the Pool Income bonus pool.
The Pool Income bonus pool is made up of 5% of FirstCoin Club investment volume company-wide.
Joining FirstCoin Club
FirstCoin Club affiliate membership is tied to an investment of firstcoin.
- Basic – invest $200 to $1999 in firstcoin
- Silver – invest $2000 to $9999 in firstcoin
- Gold – invest $10,000 to $24,999 in firstcoin
- VIP – invest $25,000 or more in firstcoin
The more an affiliate invests the higher their income potential via the FirstCoin Club compensation plan.
FirstCoin Club seeks to remedy the problem of Ponzi point “cryptocurrency” MLMs (ala OneCoin) being not publicly tradable.
They do this by requiring affiliates purchase firstcoin before investing it in FirstCoin Club.
An affiliate can only acquire firstcoin via a public exchange.
On the surface this creates the impression of a cryptocurrency with legitimate supply and demand, until you scratch the surface.
The FirstCoin Project website reveals that there are 110 million firstcoins, of which 109.9 million are pre-mined.
Who owns the 99.9% of available firstcoins? Why, none other than the anonymous owner(s) of FirstCoin Club.
When a prospective affiliate puts in a buy request for firstCoin on a public exchange, they’re in reality just buying the coin from FirstCoin Club.
Once acquired, a FirstCoin Club then parks their firstcoin with the company and collects a monthly ROI.
From here it’s the same old Ponzi points business model.
FirstCoin Club take funds they receive for selling pre-mined firstcoin they generated at little to no cost, to pay FirstCoin Club affiliates a monthly ROI.
The funds are sourced from new and existing FirstCoin Club affiliates buying firstcoin to invest.
Technically an affiliate could sell firstcoin to another affiliate and undercut FirstCoin Club, but this is unlikely. There’s no practical use for firstcoin outside of investment in FirstCoin Club.
The usual “we’re gunna be the next bitcoin!” comparisons are made to market FirstCoin Club, further encouraging affiliates to keep their firstcoins parked in FirstCoin Club.
Referral commissions add an additional pyramid layer to the scheme, as they directly reward FirstCoin Club affiliates for bringing new affiliate investors on board.
As with all Ponzi schemes, a slowdown in affiliate recruitment means a slowdown in new funds entering the scheme.
This will manifest itself by way of a decline in buy orders on exchanges for firstcoin. This in turn starves firstCoin of its only revenue source, leaving it unable to meet its ROI obligations.
At that point the Firstcoin bubble bursts, with the value of the coin plummeting as affiliates rush to sell.
The owners of FirstCoin Club meanwhile quietly slink away, keeping whatever they’ve skimmed off of public firstcoin buy orders.
The FirstCoin Club compensation plan states that ‘to buy firstcoin is possible only with bitcoin‘, so recovering stolen funds from FirstCoin Club’s admin scammers is realistically unlikely.
Although convoluted through the use of public exchanges and MLM business model, firstcoin is simply yet another pump and dump altcoin.
It’ll be interesting to see how the public exchanges tackle this, especially if the public exchange manipulation model catches on.
Technically firstcoin is a legitimate cryptocurrency and functions on a technical level as such.
The problem is firstcoin was created solely to facilitate Ponzi fraud, in much the same way bitcoin can be used to power Ponzi schemes.
Whereas bitcoin has legitimate uses and genuine public supply and demand though, firstcoin has neither.