Crypto-MLM systems have been recognized in 2017 in the hype around cryptocurrency and blockchain as a means of large-scale rip-off possibility. The German and Austrian MLM artists dedicated themselves intensively to this topic and raised millions of Euros from naive investors. In Austria, the 21Group in Linz has proven to be a highly efficient distribution structure for the sale of crypto-mining packages and MLM memberships. The 21Group was also intensively involved in the meanwhile collapsed COINTED and thus has probably the relevant experience.
21Coinworld – Perhaps most colorful crypto-MLM
21Coinworld (“21C”), which as many other crypto-schemes has its official headquarters in Dubai, is arguably by far the most colorful and at the same time least known crypto-MLM on the market at the moment. Actually, they are latecomers and launched their scheme in autumn 2017 when their fellow Germans and Austrians already have run OMNIA TECH and USI-TECH for quite a period. The 21C project owes its “colorful” attribute not only to the fact that it is backed by the Austrian IT and energy entrepreneur Gerald WIRTL. The project gets its color from WIRTL’s partnership with the notorious crypto-MLM guy and OMNIA TECH (Dubai) founder Robert VELGHE. VELGHE and his OMNIA TECH also fill entire file cabinets at FinTelegram. Finally, the fact that the financial distributor 21 Group acts as WIRTL’s financial advisor spices the project up. This 21 Group was involved in the COINTED scandal around Christopher RIEDER and Charli AHO and produced the much-disputed “Cointed Transparency Report” which turned out to be misleading and simply wrong.
These ingredients undoubtedly make 21C an interesting global player on the crypto rip-off market. In this respect, the address in Dubai is more than appropriate as most of the other German and Austrian crypto-MLM’s are also headquartered there.
Why do we use the term “rip-off” here? Quite simply because the business model of crypto mining simply cannot function in such an MLM structure as that of 21C or OMNIA TECH and can only be maintained as long as new investor money flows in. After deduction of the commissions for the distributors of these PONZI schemes, there is not much left for the mining itself and the little that is invested probably does not even earn enough to maintain the infrastructure in this market environment. Experienced operators such as Gerald WIRTL and Robert VELGHE know this and yet they operate these systems. With all due caution, we take the liberty of using the term “rip-off” to protect investors and can defend it even in the event of legal action.
But let’s start the fantastic story of the 21C at the beginning.
In the beginning, there was green energy and crowdfunding
Fiat Lux! Crypto mining needs energy. A lot of energy. It is therefore not surprising that the founder of OMNIA TECH, Robert VELGHE (Austria), for example, comes from the energy sector. He used to run an energy-MLM before starting OMNIA TECH. Gerald WIRTL evidently also roots in the energy sector and financed his photovoltaic projects via the firstcap crowdfunding platform of the 21 Group.
Before entering the energy sector, Gerald WIRTL built notebooks with his Austrian company Chilligreen. He sold the company in 2008 and dedicated himself to other IT projects. With his professional background as “IT-hardware producer” and “power plant operator”, the entry into crypto-mining in the hype of 2017 was obvious. Producing one’s own mining servers and supplying them with home-made resp. green energy is indeed a captivating idea. This probably was the starting point for the foundation of 21Coinworld.
Let’s Jump the Crypto-Bandwaggon
While running his crowdfunding campaign with his GW Energie Holding GmbH, Gerald WIRTL established Bit&Coin AG in Liechtenstein in July 2017 (see announcement). According to the company’s website, its purpose of this company is to produce ASIC miners “with 82% more efficiency as the fastest competitor” and, additionally conduct industrial crypto-mining. According to the website, EUR 1 million of share capital was paid in.
The answer is obvious: utilize the crypto-hype to raise even more money from retail investors.
Let’s build miners and ATM’s
In October 2017, Avatar Technology GmbH was founded by Marco MOESTL . This company is 15% owned by Avatar Bitbyte AG, based in Zug (Switzerland), and 85% by Gerald WIRTL. The CEO of the Swiss AG is Albert HINTERDORFER, who was subsequently introduced as CEO of 21Coinworld Project.
This Avatar Technology GmbH, based in Linz, Austria, is to focus on crypto-mining and also produces and sells crypto-ATMs. On its website there is not really much information about this, it looks rather “scammy”. What is interesting, however, is that the most important task of Avatar Technology GmbH is the raising of up to EUR 10 million of investors. For this purpose, the company has prepared a capital market prospectus and made it available for download via its website. After a first review of the capital market prospectus, we can draw the following conclusions:
the prospectus does not disclose the fact that Gerald WIRTL is the beneficial owner of the company and part of the management team (this has to be revised: SEE our UPDATE below)!, and that in the current assessment of the Austrian Financial Market Authority (FMA), the business model is most likely to be regarded as an Alternative Investment Fund (AIF) subject to approval, which requires a licensed AIF Manager (AIFM). Read our analysis on crypto-mining and AIF here.
The question arises as to why Gerald WIRTL is hiding and why the true ownership and management structure is not disclosed to potential investors.UPDATE: the prospectus was established and approved BEFORE Gerald WIRTL and Avatar BitByte AG took over 100% share capital of Avatar Technology GmbH in summer 2018!
The start of the #C21Coinworld
At some point between the founding of Bit&Coin AG in Liechtenstein and Avatar Group in Switzerland and Austria, 21Coinworld (“21C“) was launched. At least on paper, the perfect complement to crypto-hardware and power production. 21C is designed as a crypto-MLM like the OMNIA TECH of the Austrian Robert VELGHE. The hunt for the millions of crypto investors by 21C began amidst the hype surrounding cryptocurrencies in late 2017.
Officially, 21C bills itself as a kind of DAO (Decentralized Autonomous Organization) without a centrally governing person. This DAO approach is especially popular in the area of crypto-PONZI systems (e.g. Infinity Economics /”XIN” – they have also been fooling investors with this fancy “DAO” thing for years). Those schemes hope to appear decentralized according to their “own rather strange interpretation of decentralization”.
Literally, it means that there is no identified responsible person, but a team of different anonymous experts which operate C21. No names and identities are given on 21C’s website. The history of C21 begins sometime in summer 2017 when the domain www.21coinworld.com was registered (August 2017).
From the Facebook channel of 21C and from various experience reports one learns that the Austrian Albert HINTERDORFER acts as CEO of the scheme. Apparently, this very Albert HINTERHOFER is also the CEO of Avatar Bitbyte AG of Gerald WIRTL. Additionally, 21C entertains official partnerships with WIRTL’s Bit&Coin AG and Avatar Group according to their Facebook channel. The guys around 21C developed an intransparent network or companies and organizations. Evidently, it’s Gerald WIRTL who controls most of the 21C entities and sort of governs the network.
These are the acting persons and companies around the Crypto-MLM 21Coinworld:
|21Coinworld||Albert HINTERDORFER, Gerald WIRTL||A crypto-MLM powered by Bit&Coin AG|
|21 Group||Sebastian AIGNER||A financial services group in Austria, operator of the crowdinvesting platform firstcap, partner of Gerald WIRTL|
|AVATAR Technology GmbH||Marco MOESTL, Gerald WIRTL||A producer of crypto-ATM’s and operator of a crypto-mining scheme like to be qualified as AIF.|
|AVATAR Bitbyte AG||Albert HINTERDORFER||Holding company of the AVATAR Group|
|Bit&Coin AG||Gerald WIRTL, Günther WIESAUER||Producer of crypto-mining hardware and operator of crypto-mining operation, partner of 21C and Robert VELGHE’s crypto-MLM scheme OMNIA TECH|
|Block&Chain Technologies GmbH||Gerald WIRTL, Andreas BUCHINGER||Holding company of Bit&Coin AG|
|OMNIA TECH||Robert VELGHE||A crypto-MLM scheme operated by the Austrian Robert VELGHE, partner of Bit&Coin AG|
By the end of 2017, the WIRTL network had 3 large capital raising activities underway, which, with the support of the 21 Group, moved millions of investor funds:
In the second part of our report about the amazing 21C we go into detail about this MLM scheme. Hints and comments are always welcome via our whistleblower system.