HitStake Review: HITS points ICO lending Ponzi scheme
HitStake provide no information on their website about who owns or runs the business.
The HitStake website domain (“hitstake.com”) was privately registered on February 13th, 2018.
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.
HitStake has no retailable products or services, with affiliates only able to market HitStake affiliate membership itself.
The HitStake Compensation Plan
HitStake affiliates acquire pre-generated HITS points from the company’s anonymous owners.
HITS are sold to HitStake affiliates for 60 cents to $1.20 each.
Once acquired, HITS points are “lent” back to HitStake on the promise of a monthly ROI of up to 45%.
- Bronze – invest 100 to 400 HITS points and receive a daily variable ROI plus bonus 0.05% daily bonus rate for 199 days
- Silver – invest 401 to 2000 HITS points and receive a daily variable ROI plus bonus 0.15% daily bonus rate for 125 days
- Gold – invest 2001 to 5000 HITS points and receive a daily variable ROI plus bonus 0.2% daily bonus rate for 99 days
- Platinum – invest 5001 HITS points or more and receive a daily variable ROI plus bonus 0.25% daily bonus rate for 70 days
HitStake pay referral commissions on invested funds down two levels of recruitment (unilevel):
- level 1 (personally recruited affiliates) – 8%
- level 2 – 3%
HitStake affiliate membership is free, however free affiliates only receive referral commissions.
Full participation in the HitStake compensation plan requires a minimum investment of 100 HITS points at the going rate.
HitStake claim to generate external revenue through “HitBot”, an “automated trading program”.
The company provides no evidence of HitBot existing, or any other external source of ROI revenue.
That leaves new investment as the sole source of revenue entering HitStake.
Using newly invested funds to pay existing affiliates a daily ROI makes HitStake a Ponzi scheme.
Lending ICO Ponzis like HitStake play out as follows:
Admins (who are typically anonymous) offload worthless pre-generated points in exchange for real money. In this case it’s HITS points.
HitStake’s admins then use some of this money to pay promised ROIs for as long as new affiliates sign up.
Once affiliate recruitment dries up so does HitStake’s ROI reserve.
When a predetermined threshold is reached, HitStake’s anonymous admins do a runner with what’s left.
Early HitStake investors make a bit of money (mostly via recruitment of new investors). But same as any other Ponzi scheme, the reality of such scams is that the majority of participants eventually lose money.