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What Does Cash FX Do?
I’ve been researching a Bitcoin program called Cash FX (also known as CFX or Cash FX Group) that I came across a few days ago to see if it’s yet another Ponzi scheme, a scam or run by shady characters.
In a nutshell, what Cash FX claims to do is make foreign currency (Forex) trades with your money and give you a cut of the profits.
The trades are supposed to be carried out by professional Forex traders and trading bots.
Not every trade will be successful, but there will be more wins than losses and so, as time goes by, you’ll earn a profit on your investment.
How Cash FX Is Structured
When you join, you select the investment package you want to start with. These range from $300 to $100,000.
70% of that goes to the investment pool to be used for trading.
The other 30% is used to pay commissions – half the 30% (15%) is paid to the person who referred you and the other 15% goes into the bonus pools.
There are two sides to earning profits – the Bear and the Bull.
It’s all quite convoluted and I haven’t got my head around it all yet but…
You can earn up to 2X your investment on the Bear side and up to 2X on the Bull side (so 4X in all).
If you max out your profits at 2X, then you have to cash out and you cannot upgrade your investment package.
If you want to continue with Cash FX, then you would need to buy another investment package, either the original one or a higher-level one and you’d pay full price for that package.
However, you have the opportunity to upgrade your investment package before your profits reach 2X (200%).
To do that you need to withdraw whatever profits you have to your Bitcoin wallet and then pay for the upgrade from your wallet.
While you can withdraw at any time, there’s a minimum withdrawal amount of $100.
As I understand it, it’s illegal for a company to allow you to upgrade plans like these from within the investment system.
There is a 20% fee for withdrawing from Cash FX though.
That money doesn’t go to the company. It goes back into a pool for members and is paid out as other bonuses.
When you buy an upgrade, you only pay the difference between your current package and the cost of the next package up.
You can’t leap-frog over packages – you have to upgrade through them sequentially.
Profits come from the Forex trading done by Cash FX on your behalf, commissions from new members joining below you, commissions from people below you who upgrade and the couple of different pools created within Cash FX.
The Affiliate Program
Naturally, Cash FX has an affiliate program and members are encouraged to recruit other people to help change their lives also.
There are no passups with their compensation model.
Whatever package someone joins under you with, as an affiliate you get 15% of what they pay.
If you refer someone who buys the $100,000 package, you’d earn a $15,000 commission (what’s called a Fast Start Bonus).
You also get 15% of any upgrades they buy in the future.
Forex trading is carried out Monday-Friday, 24 hours a day and profits are paid out on Saturdays.
You also earn commissions from people who sign up several levels deep below you.
As this happens, you acquire a “Leadership Level” which confers additional bonuses to you:
The commissions start out at 10% and generally decrease the further down in level they are below you.
Some upgrades you take out yourself open up additional levels for you to earn from.
And the commissions on some levels are also increased.
In all, there’s about 6 ways to earn from Cash FX which are explained in this PDF document.
You do have to be a member (have bought an investment package) to become an affiliate.
So Why Is This In the Cryptocurrency Niche?
While Cash FX purports to engage in Forex trading, it’s in the crypto niche as deposits and withdrawals are all in Bitcoin.
It’s not clear to me yet if Cash FX does crypto trading as well as Forex trading.
While both involve making profits from exchanging currencies, they’re actually two different markets.
But Bitcoin is crypto and that’s ultimately what you earn.
So Is Cash FX a Ponzi Scheme Or Not?
Honestly, I don’t know.
Many such schemes last a few months to a year, close up shop and then disappear with investors’/members’ money.
Those who get into those schemes early do make money, those who get in late in the day end up losing their investment.
CashFX celebrated its 1st Year Anniversary in November 2020 and they seem to be still going strong.
Despite passing the 1 year mark doesn’t mean it’s still not a Ponzi.
These programs can run for years so long as new people keep joining.
Just ask anyone who invested with Bernie Madoff!
Now, there are a couple of red flags where CashFX is concerned…
- First, there’s a fairly strong push for you to refer others.
- Second, they’re located in Panama, a country usually selected by companies that like to avoid the regulatory gaze of governments (remember the Panama Papers?).
- Third, you can only submit your investment in Bitcoin. That makes it hard for transactions to be tracked and for investments to be recovered. In other words, there’s no (or not much of a) paper trail.
Looked at from a different perspective, this means you can invest your money where you’re taking all the risk and not have a government get in the way or try to extort taxes from you.
Whether you declare any income from a program like this or not comes down to your own morals and values.
But, since any money you make from a program like this is in the Bitcoin sphere, it can all be done outside of government regulation.
Maybe that’s something you’re for. Maybe not.
Personally, if I’m taking a risk investing my money, whether that’s on stocks and bonds, precious metals or whatever, I don’t think I should have to pay tax on any profits I make…
…but, like a mobster, the government demands its cut of any profits I make.
I stand to lose some or all of my investment by taking that investing risk and, if I do lose money, the government doesn’t compensate me for any loss.
They’re happy to take a cut of your profits but don’t want to know when you face a loss.
What People Are Saying About Cash FX
Despite the high Trustpilot rating, many of these 4-star reviews are actually quite negative!
I looked at a lot of Cash FX reviews and comments from members and non members.
As a company, they do seem to be sailing close to the wind.
Many reviews either call it an outright Ponzi or that it’s a shady enterprise best avoided.
But some reviewers have certainly either misread the suggested returns or are mis-representing them.
As an example, some reviews I’ve read say that Cash FX promises a 15% return per week and a consistent return of that level is impossible over the long-term.
However, the Cash FX site makes no such claim.
What it does say is that a maximum of 15% will be paid out in any one week, and returns are more likely to be in the 5%-10% range.
Still high in comparison to what a bank will give you on your deposits over a year.
But that equates to a 1%-2% profit per day.
Day traders with iCoinPro (I talked about that program in my last post) – a platform that teaches you how to trade cryptocurrencies with some specific strategies – teaches their members not to be greedy with their trades and that they should average a profit of 0.3% – 1% per trade.
So, in that context, Cash FX’s daily returns don’t seem that off the mark.
Bear in mind that I say this as someone who knows nothing about trading or Forex but I did recently sign up with iCoinPro to learn their strategies.
There’s a mixed bag of opinions from Cash FX members, former members and non-members, all giving their $0.02 worth.
Many members are extremely happy with the returns they’ve been getting, but you would expect that from members who join any Ponzi scheme early (whether they’re aware it’s a Ponzi or not).
On the other hand, many of those members see Cash FX as a legitimate, if unorthodox, company that delivers on its promise of changing their finances for the better.
Some claim they’ve lost their money and had to hire debt collectors to get their money back.
One thing that does seem to have happened is that the Cash FX site has been effectively copied by definitely malicious actors and people have been duped into joining those cloned sites rather than the proper Cash FX site.
And, because those definitely are not legitimate enterprises, people who invested in those programs have been scammed and lost their money.
Some Cash FX members claim that they can’t get payouts, yet the vast majority of comments I’ve seen from Cash FX members is that payouts happen like clockwork on Saturdays.
The Financial Control Authority in the UK have a page that warns people not to invest with the company as they’re not regulated and they’re not listed with the Better Business Bureau in the USA.
A search on Google shows that similar warnings have been issued in other countries too, such as Norway, Canada and even in Panama.
The guy in this video does a very good job of explaining what not being regulated means for customers. It’s an informative watch:
A lot of sites and videos I looked at during my research talked about how Cash FX claimed that their broker is EverFX…but EverFX say they don’t have a trading or business relationship with Cash FX.
You can see old copies of the site’s original About Us page on the WayBackMachine if you do a bit of research where their association with EverFX is advertised as one of the reasons CashFX is trustworthy.
However, now in early February 2021, there’s no mention of EverFX anywhere on the site.
So were CashFX lying about EverFX being their trading broker?
And if they were, were they actually using a different broker to carry out trades on their behalf or did a real relationship with EverFX break down somewhere along the way?
And if they were lying or misrepresenting EverFX’s involvement and weren’t actually trading, then where are the profits that are being paid out every week coming from?
Cash FX says that it makes most of its profits from foreign currency (Forex) trading rather than the investments deposited by new members and upgrades purchased by members.
But it’s hard to find any real documented trades to back this claim up.
Members point to a feature of CashFX called WebTV where you can look at trades as they happen.
The problem is that these aren’t transparent trades. They could be a spooled playback of scripted trades rather than real trades.
As I write this, Cash FX has 170,000 members around the world with 1,000 joining each day.
So it’s certainly struck a nerve with people who have been looking for a way to improve their finances online.
Have Cash FX Investors Been Duped?
170,000 people joining over 14 months is about 12,000 new members per month or 400 per day.
If this is a Ponzi scheme, is that enough people to keep it going for any length of time?
The minimum trading investment is $300, so if all members joined with this package, that would mean it has a fund of at least $51,000,000.
Only 70% of these investments go into the investment fund, so in this example that would be an investment fund of $35,700,000.
Assuming an average of 1% profit per day, that would mean Cash FX has $357,000 to pay out as profit per day to 170,000 people, or $1,785,000 per week.
Given that a $300 trading package should return about $10 profit per week, then payouts to the 170,000 membership is just about covered by this amount, but for 1 week only.
With 1,000 new members joining per day, that’s an additional $300,000 per day ($2.1 million per week), at least, being added into the coffers.
Now Cash FX will have more money to play with because a percentage of members will reinvest funds to upgrade to the next package level.
And there’s the price of Bitcoin to factor in.
But, even with all those variables, it doesn’t look like investments, reinvestments and a rising Bitcoin price would generate enough money to cover everyone’s weekly profits over an extended period of time.
And CasFX has been operating for 14 months now.
So either one of two things is likely to happen in the very near future:
- If this is a Ponzi scheme, then soon there won’t be enough new people coming in to keep paying the profits for existing members. Cash FX will collapse, leaving yet another tranche of very unhappy investors
- Cash FX is actually doing Forex trading, if not exactly transparently, and those trades are profitable and all members will continue to receive their profits.
I’m actually 50/50 on whether this is something worth taking a chance on or not.
The emotional side of my brain is telling me to take the chance as I can afford to lose $300 if it all goes south but I stand to gain good profits if it’s legit…
…while the logical side of my brain is telling me that this probably is a Ponzi and I’d be putting money into it just as it’s about to collapse.
So I decided to flip a coin – heads I invest, tails I don’t…
…and it’s come up heads.
Okay, best out of 3 then…
…and it’s heads again.
Okay, I guess I’m putting $300 into Cash FX.
Please don’t take this as any kind of endorsement or recommendation to join.
Do your own due diligence.
This is most definitely a case of Buyer Beware!
Joining Cash FX
I’m in the fortunate position to be able to afford to lose $300 and I’m approaching this experiment as if I will lose that money.
I’ll document my progress with Cash FX here on this blog from time to time so you can see how I get on with it.
One thing I should mention is that in my research I came across a team of investors (mostly just ordinary people like you and me) inside Cash FX and I signed up under one of these people.
One of the reasons I did this is because they operate a link rotator.
They have a generic link that rotates through all team member’s signup URLs sequentially and there’s a chance that someone signing up at the rotator link could be placed under me (it all depends on how many people eventually sign up under this team).
I’d then earn a commission from their investment, so that’s an additional way I can earn money with the program.
At the moment, I’m not actively recruiting for the program as an affiliate.
I signed up for the Cash FX $300 package and here’s my dashboard:
No earnings to date but that’s because I only joined last Friday (Feb. 5) and Forex trading won’t begin again until today (Monday).
My $300 investment isn’t listed as that’s not earnings.
Part of it been used to pay a Fast Start commission to my referrer, to add to the members’ bonus pool and 70% of it has been added to the trading funds account.
I want more time with Cash FX to see how things play out over the coming weeks and months before I determine if it’s a program I’ll actively promote or not.
That said, if you’re intrigued by the program and want to sign up yourself, you can do that here.
You’ll become part of our team, get some bonuses (from the team leader) and your own sign up link will be added to the link rotator.
You can’t join Cash FX directly from their home page – you can only join through a member’s referral link.
The program is not open to people in the USA, Canada or South Korea but you can always use a VPN to circumvent that if you live there and are determined to join.
Remember, if you do decide to join, it is entirely at your own risk.
I am not a financial advisor or a trader and don’t endorse or recommend the program, certainly not at this stage of proceedings.
- DO NOT invest money you can not afford to lose.
- DO NOT put your life savings into this under any circumstances.
- DO NOT borrow money to invest either.
- DO be prepared to lose your money
This program has all the hallmarks of being a Ponzi scheme.
There are several red flags from its incorporation in Panama to it only accepting payments and issuing withdrawals in Bitcoin.
There’s no transparent trading, demo trading or access to their investment account through established trading platforms such as MetaTrader 4.
Progression in the system to earn bigger trading profits, commissions and bonuses, requires you to reinvest funds to move up to the next level.
That means that a lot of capital is actually tied up in the investments which could be used to payout earnings.
Apparently over $400,000,000 has already been paid out to members and if Forex trading is really not being done, then where’s that money come from?
I’m not in a position to say if this is a Ponzi nearing the end of its life or if it’s a legitimate investment opportunity.
Only time will tell on that.
At a 1% profit per day, just on the forex trading side of things, it would take 143 business days for me to recoup my investment.
Remember that $210 (70%) of my $300 investment is what’s actually traded and an average return of 1% per day is $2.10. 300 / 2.1 = ~143 and trading is only done on business days.
That’s 6 to 7 months to recoup, since there’s no trading on weekends.
It’ll be interesting to see if Cash FX will be around long enough for me to get my investment back , let alone start to see some real profits from the system.
I’ll keep you posted with my progress as the weeks go by.
If you’ve any experience with Cash FX yourself, good or bad, let me know in the comments below…
All the best,
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