This week, we discovered that Red Bull Racing, one of the most prominent and richest Formula One teams, has signed a new sponsorship deal with a cryptocurrency – the first deal of its kind in Formula One. There is just one small issue that Red Bull Racing seems to have overlooked. Their new partners Futurocoin have a questionable history according to some.
Futurocoin originally began under the name FutureNet. FutureNet was created and run by Roman Ziemian and Stephan Morgenstern. On the FutureNet website, it describes itself as a social platform akin to social media, with the key difference being that users receive part of the profits from advertising. This advertisement details all you need to know about the “spectacular” platform.
Once you reach the 5-minute mark of the video, you will realise the business plan: how you can be successful by working from home. The scheme follows a multi-level marketing (MLM) system whereby if I were to refer my friend to the system, I receive a referral bonus, then if my friend refers their friend they would get a referral bonus, and so on. I have discussed such schemes before.
For MLM schemes, making a move into cryptocurrency makes a lot of sense in that the company can attach itself to the latest buzzwords that help to build up hype. The issue that surrounds FutureNet and its cryptocurrency FuturoCoin is that it has been accused by many on the internet of being a Ponzi/pyramid scheme. To see some such claims that have gone into more detail, click here. However, it isn’t just “scam busters” that have warned about such companies. The SEC has also released warnings about companies that follow a similar business structure to FutureNet.
Whether these criticisms are valid is up for debate. Projects such as Banners Brokers and Traffic Monsoon that followed a similar business model both suffered total collapses. Many of the advocates from these failures then moved on to FutureNet to promote this company instead. There are also others that used to promote FutureNet who are now promoting a similar MLM scheme called Dascoin, which also has questionable practices according to some internet websites.
So why has Red Bull Racing signed such a deal with this company? The most obvious answer would seem to be that they have not completed their due diligence. Another potential option is that Formula One teams are desperate for more sponsorship and money so they are taking anything they can get their hands on. Red Bull Racing chose not to respond to my requests for clarification when I asked them this. The most likely scenario is that the general public will be the losers from this money-making idea.
Whilst Futurocoin fans are understandably excited about this new partnership, the biggest irony perhaps lies within the fact that it is their own money and investments that will have been used to pay for this sponsorship, and with the bear market lingering and many people within the space having never heard of this coin, there is no guarantee that this will help their price. Indeed, further exposure could in fact turn out to be detrimental to their whole MLM model.