Jeff Long announces Luvv token unregistered securities
A few months ago we reviewed Jeff Long’s Luvv opportunity.
Initial reception appears to have been lukewarm. Alexa statistics for the Luvv website show a brief spike in interest followed by a steady decline.
Now Long is marketing what he’s calling his “inner circle”, through which he’s announced Luvv tokens.
From the sounds of it the Luvv token is going to be a cookie-cutter ERC20 token.
Long (right) states its intended use will be through the “Luvv ecosystem”, although as I understand it none of that is up and running yet.
In the meantime Long is asking for $100/$200 a month or $1000 a year in inner circle fees.
In addition to Luvv tokens ($200 = 100,000 and $1000 = 1,000,000 in case you were wondering), Long’s inner circle members are put into “profit rotator”.
A profit rotator is basically a queue of people (inner circle members), who receive money on transactions within Luvv and various other businesses Long is touting.
When a transaction occurs, the person at the top of the queue gets paid and is cycled to the back of the queue. The next transaction pays the person now at the top of the queue.
They then get bumped back and so on and so forth.
In addition to Luvv, Long touts CryptoAdix, BetaGroops and Heather App as upcoming business launches.
CryptoAdix is live and promises members can earn cryptocurrency by “checking out offers” delivered via a Telegram bot.
The nature of the offers are not disclosed.
BetaGroops sounds like a KickStarter/GoFundMe clone, with messaging.
A Saas platform that would allow product creators to create and manage a list of beta users who help fund , test & perfect their ideas to prepare for launch to the public!
Not available until Q1 2019.
Heather App sounds interesting in concept but I’m not convinced it’s something people would pay money for.
An online & mobile app to assist you in managing the everyday agreements you make with others and that they make with you!
Paying a fee to hold either yourself or someone else accountable?
What happens if someone else tries to hold me accountable through Heather and I just ignore it?
Hi there. The person you tried to hold accountable didn’t do what you wanted them to.
Sorry, there’s actually nothing we can do about that. Thanks for your money tho.
Like I said, I can see it working as a novelty app but not a serious money-making business.
With Luvv tokens being generated on demand at little to no cost by Long, naturally they’re integrated into each of the above business in one way or another.
Which brings us to the headline of this article.
To fit the definition of a security, Luvv tokens would have to be sold on the expectation they’ll passively increase in value – thus paying a ROI to investors.
Here’s how Long himself touts that exact concept in an inner circle marketing video;
You will be able to sell your tokens to other new members looking to purchase tokens once we go live.
So in this way you can monetize the tokens.
As you can see, the value of these tokens alone are worth the cost of this program and more.
From this we learn there’s a planned internal exchange, through which the value of Luvv tokens are set.
Investors can collect a ROI by offloading their Luvv tokens to new bagholders.
And Long is very much touting the tokens as representing a projected value greater than the $200 a month or $1000 a year he’s asking for them.
That projection is of course based on the efforts of others (buying tokens), making the Luvv token a security.
With respect to the “Luvv ecosystem”, Luvv flopping has revealed people aren’t willing to spend actual money on the opportunity.
So why are they going to spend real money to obtain tokens and then use those tokens within the opportunity?
Beyond Luvv there appears to be a planned e-commerce platform… but again, why would I use Luvv tokens to buy whatever from a limited marketplace.
The answer by now should be obvious: Nobody outside of Long’s inner circle is going to be interested in Luvv tokens – other than as yet another speculative cryptocurrency.
Which, upon consideration of the MLM side of the business and direct investment in Luvv tokens through Long’s inner circle, brings us back to securities.
As I write this neither Jeff Long or Luvv are registered with the SEC to offer securities in the US.
This means that the Luvv token offering, as it is currently being marketed and offered to inner circle investors, would be illegal as per US securities law.
And if you want to get technical, the profit rotators themselves can be seen as a security.
You’re investing $100/$200 a month or $1000 a month, on nothing more than the promise of an expected passive ROI.
Your (inner circle) membership fee that you are paying today … is your way of positioning yourself now for the profits that will come later.
That’s from Long’s marketing video. Here’s more of the same taken directly from the inner circle membership website;
Think of it like you found a $2,400 per year business opportunity and you’re being allowed to make $200 per month payments and you’re happy to do so because every month you pay, you’re securing yourself a potential $20-$200 per day.
That’s pretty specific.
Secondary issues that persist since Luvv launched include a lack of retail sales activity tied to the business opportunity.
None of Long’s planned opportunity launches seem particularly focused on retail either.
Most are pitched as revenue generators for Long’s inner circle profit centers, in order to get people to hand over $200 a month or $1000 a year.
Oh and if you’re wondering what the difference is between the $100 inner circle membership, you don’t get any tokens and you’re limited to entry in five rotators.
To his credit Long is providing a “90 day money back guarantee”;
As long as you stay active and up to date with your payments… if after a period of 90 days, for whatever reason I have not delivered on everything I have said I would deliver on… I will issue you a FULL refund of what you have paid!
However it’s important to note this isn’t an income guarantee.
If you pay Long $1000 or $600 ($200 * 3), all he has to do is setup what he’s promised.
Whether these concepts flop or not (or Luvv is shut down), Long’s guarantee provides no obligation for the return of fees paid.