Global Game Arena Review 2.0: Doubling down on investment fraud
A while back Global Game Arena owner Frode Jorgensen reached out regarding “GGA 2.0”.
Following Global Game Arena’s collapse back in April, today we revisit the opportunity to see what’s changed.
The Company
Global Game Arena’s website contains no information about who owns or runs the company.
The original company was founded by Frode Jorgensen and Daniel Grenon.
Grenon split around the time of the collapse for FutureNet.
Update 2nd September 2019 – A BehindMLM reader has informed me that Grenon is now pitching himself as co-founder of FXTV Global. /end update
Obviously Jorgensen is still involved but it’s unclear if he’s acting alone.
Global Game Arena’s Products
Global Game Arena markets online casino games and lottery tickets.
Casino games are playable through GGA tokens. Details of the lottery are not provided.
Note that Global Game Arena do not publish the current GGA token internal value.
Global Game Arena’s Compensation Plan
Global Game Arena affiliates sign up and invest in GGA and GGA Gold tokens.
- Green – invest €500 EUR and receive 1000 GGA tokens and 3 GGA Gold tokens
- Yellow – invest €2500 EUR and receive 5000 GGA tokens and 15 GGA Gold tokens
- Purple – invest €5000 EUR and receive 10,000 GGA tokens and 30 GGA Gold tokens
Commissions are paid out when they recruit others who do the same.
A secondary component to Global Game Arena’s compensation plan are casino generated commissions.
Global Game Arena Affiliate Ranks
There are nine affiliate ranks within Global Game Arena’s compensation plan.
Along with their respective qualification criteria, they are as follows:
- Affiliate – generate at least one residual commission cycle
- Executive Affiliate – generate at least twenty-five accumulated residual commission cycles
- Sapphire – generate at least one hundred accumulated residual commission cycles
- Emerald – generate at least five hundred accumulated residual commission cycles
- Ruby – generate at least one thousand accumulated residual commission cycles
- Diamond – generate at least five thousand accumulated residual commission cycles
- Blue Diamond – generate at least ten thousand accumulated residual commission cycles
- Red Diamond – generate at least twenty thousand accumulated residual commission cycles
- Black Diamond – generate at least one hundred thousand accumulated residual commission cycles
For more information on residual cycle commissions see “residual commissions” below.
Casino Commissions
Global Game Arena’s compensation plan states that affiliates can
earn from casino products and product sales generated by your team of players.
As I understand it Global Game Arena’s retail customers are its non-affiliate referred players.
Commission volume generated via player casino activity is calculated based on their losses.
Casino commissions are paid out a percentage of these losses as follows:
- affiliates with one active player receive 25% of their player’s losses
- affiliates with two to four active players receive 30% of their player’s losses
- affiliates with five to fourteen active players receive 35% of their player’s losses
- affiliates with fifteen to twenty-nine active players receive 40% of their player’s losses
- affiliates with thirty or more active players receive 45% of their player’s losses
On the MLM side of things, $10 in losses generates 1 PV/GV.
Global Game Arena also apparently sells lottery tickets, which generate a 10% commission.
Recruitment Commissions
Global Game Arena affiliates receive 10% of funds invested by recruited affiliates.
Residual Commissions
Global Game Arena pays residual commissions via a binary compensation structure.
A binary compensation structure places an affiliate at the top of a binary team, split into two sides (left and right):
The first level of the binary team houses two positions. The second level of the binary team is generated by splitting these first two positions into another two positions each (4 positions).
Subsequent levels of the binary team are generated as required, with each new level housing twice as many positions as the previous level.
Positions in the binary team are filled via direct and indirect recruitment of affiliates. Note there is no limit to how deep a binary team can grow.
Binary volume is generated via casino player activity (see “casino commissions above), and directly and indirectly recruited affiliate investment.
- recruitment of a Green tier affiliate generates 150 GV
- recruitment of a Yellow tier affiliate generates 750 GV
- recruitment of a Purple tier affiliate generates 1500 GV
GV stands for “Group Volume” and, as opposed to raw investment volume, is a reductive points based system used to calculate residual commissions.
A binary commission cycle is generated for each 150 GV matched on both sides of the binary team.
The payout per binary commission cycle calculated each week starts at €50 EUR.
- Affiliates earn €50 EUR per cycle
- Executive Affiliates earn €55 EUR per cycle
- Sapphire affiliates earn €60 EUR per cycle
- Emerald affiliates earn €65 EUR per cycle
- Ruby affiliates earn €70 EUR per cycle
- Diamond affiliates earn €80 EUR per cycle
- Blue Diamond affiliates earn €90 EUR per cycle
- Red Diamond affiliates earn €100 EUR per cycle
- Black Diamond affiliates earn €150 EUR per cycle
Note that weekly residual commissions are also capped based on how much a Global Game Arena affiliate has invested:
- Green tier affiliates are capped at earning €10,000 EUR a week in residual commissions
- Yellow tier affiliates are capped at earning €20,000 EUR a week in residual commissions
- Purple tier affiliates are capped at earning €30,000 EUR a week in residual commissions
Matching Bonus
Global Game Arena pays a Matching Bonus on residual commissions earned by downline affiliates.
The Matching Bonus is tracked 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.
Global Game Arena caps the Matching Bonus at five unilevel team levels.
How many levels an affiliate earns the Matching Bonus on is determined by how many cycles an affiliate earned:
- earn ten binary cycles and receive a 15% match on level 1 (personally recruited affiliates)
- earn fifteen binary cycles and receive a 15% match on level 1 and 10% on level 2
- earn twenty binary cycles and receive a 15% match on level 1, 10% on level 2 and 5% on level 3
- earn twenty-five binary cycles and receive a 15% match on level 1, 10% on level 2 and 5% on levels 3 and 4
- earn fifty binary cycles and receive a 15% match on level 1, 10% on level 2 and 5% on levels 3 to 5
Note that it is unclear whether cycle qualification is weekly or accumulative.
Hodl Box Returns
Global Game Arena’s compensation plan states that
GGA tokens in affiliate packages are automatically placed in the Hodl Box.
The Hodl Box provides affiliates with a daily percentage return, paid out in tokens.
- Green tier investors receive 0.1% a day
- Yellow tier investors receive 0.3% a day
- Purple tier investors receive 0.6% a day
Rank Achievement Bonus
Global Game Arena rewards affiliates with GGA tokens for qualifying at the Executive Affiliate and higher ranks.
- qualify as an Executive affiliate and receive €100 EUR worth of GGA tokens
- qualify as a Sapphire affiliate and receive €500 EUR worth of GGA tokens
- qualify as an Emerald affiliate and receive €1500 EUR worth of GGA tokens
- qualify as a Ruby affiliate and receive €5000 EUR worth of GGA tokens
- qualify as a Diamond affiliate and receive €25,000 EUR worth of GGA tokens
- qualify as a Blue Diamond affiliate and receive €50,000 EUR worth of GGA tokens
- qualify as a Red Diamond affiliate and receive €100,000 EUR worth of GGA tokens
- qualify as a Black Diamond affiliate and receive €200,000 EUR worth of GGA tokens
Note that Global Game Arena does not publicize the internal GGA token value.
Joining Global Game Arena
Although Global Game Arena marketing their affiliate packages as “optional”, investment in at least one is required to fully participate in the attached MLM opportunity.
This is based on weekly residual binary commission caps, which start at €10,000 at the Green tier.
With that in mind, there are three paid Global Game Arena affiliate options:
- Green – €500 EUR
- Yellow – €2500 EUR
- Purple – €5000 EUR
There is no stated residual binary commission cap for affiliates who don’t invest in Global Game Arena’s compensation material.
Conclusion
Our primary concerns with Global Game Arena’s original business model were that GGA tokens were Ponzi points, and that the casino side of the business was illegal.
Global Game Arena’s GGA tokens are still Ponzi points. The introduction of “Hodl Box” makes this even more blatant.
Through Hodl Box, Global Game Arena’s casino operations become irrelevant.
Affiliates sign up, invest in tokens, said tokens are “automatically placed in the Hodl Box”, and daily returns in tokens are generated.
Returns are realized when Global Game Arena affiliates withdraw through Global Game Arena’s internal exchange.
The funding of returns by subsequent investment in Global Game Arena affiliate packages remains present.
By nature of Hodl Box being a passive investment scheme, it constitutes a securities offering.
This requires Global Game Arena to register itself with securities regulators in every jurisdiction it solicits investment in.
When I brought this up with Frode Jorgensen, he stated
the purpose for and thought of the Hodl Box is to give players more tokens as a bonus to play for in the casino.
I see your concern, but i don’t think it is related to securities fraud since the tokens have real value and are used in the Casino to play Casino Games.
The fact that the casino can be ignored entirely in favor or withdrawing GGA tokens through the exchange appears, intentionally or otherwise, lost on Jorgensen.
This is verbatim from Global Game Arena’s compensation plan;
All daily rewards are paid directly to your GGA Token wallet.
You can withdraw your deposited tokens at any time.
When I pushed him further on it, Jorgensen retreated into the “bitcoin isn’t a security” trope.
To be clear, the issue here is Global Game Arena’s passive investment opportunity – that’s the security.
With respect to securities regulation, the vehicle the security is offered through (bitcoin, GGA tokens, fiat etc.) is irrelevant.
GGA Gold tokens are new too.
Taken from Global Game Arena’s compensation plan, here’s the primary purpose of GGA Gold tokens.
Token holders on pay-day will get a Quarterly Bonus paid to their GGA Wallets deriving from 50% of Gross Profit company wide.
Two things:
- if the majority of “gross profit company wide” is affiliate investment, that’s a clear-cut Ponzi scheme;
- investing in GGA Gold tokens, doing nothing and collecting a passive quarterly return is indisputably a securities offering.
Moving on to Global Game Arena’s casino operations, here’s what we wrote in our original review:
Global Game Arena provide no evidence of being registered or licensed to provide access to gaming activities in any jurisdiction.
This means that the company’s gaming offerings are illegal in most countries.
In the footer of Global Game Arena’s website, it states
All GGA products and games are jointly operated by Global Game Arena Ltd. and Novus Solutions Curacao N.V.
Quite obviously those are both shell companies. Does the scam-friendly Curaçao jurisdiction regulate gambling?
According to the Global Legal Group, online casino gaming is regulated in Curaçao by the Curaçao eGaming Licensing Authority.
Global Game Arena provides no indication on its website that it has registered with the Curaçao eGaming Licensing Authority.
Or with gaming regulators anywhere in the world for that matter.
On top of Ponzi and illegal gambling concerns, Global Game Arena’s business model also triggers pyramid scheme and pay to play regulatory red flags.
Global Game Arena is a pyramid scheme by way of affiliates getting paid 10% to recruit new affiliates who invest.
Investment volume also generates binary team volume. If said affiliate investment volume is the primary source of binary team volume company-wide, that re-enforces the pyramid nature of the business.
Pay to play is evident by way of how much a Global Game Arena affiliate invests capping their weekly residual commission earnings.
All in all not much has changed with Global Game Arena.
Token investment is still the core focus of the business, with gaming serving as a pseudo-compliance backdrop.
If approached about the opportunity, you can confirm this by asking how many “self-funded” players the affiliate has.
That is affiliates who have personally funded gaming activity to generate binary volume.
Keep in mind tokens can be given out to player so be sure to discard those players.
As with all MLM Ponzi schemes, once investor recruitment dies out so too will invested funds.
This will prompt a collapse, resulting in the majority of Global Game Arena investors losing money.
Update 14th May 2020 – Global Game Arena appears to have collapsed sometime after launch. In early 2020 it was rebooted as BetPlay365.
Update 30th May 2020 – BetPlay365 has been rebooted as Daxio.
