Coins of Change, a bitcoin gifting scheme, has failed to disclose its ownership, a common red flag for fraudulent operations. The scheme's website, coinsofchange.org, registered on July 20th, 2017, uses the same name servers as bitcoinsetupsite.com, a site cloned from Coins of Change.
The owner of Bitcoin Setup Site is Mike Hollen, based in Iowa. His registration details link him to Pronto Web Services, a shell company registered in Panama, and IsoMedia, a web hosting provider. It is unclear how deeply Hollen is involved with Coins of Change beyond website development. Three administrators for the official Coins of Change Facebook group are listed as Edmond Lee, Jorge Raziel, and Domingo M. Silvas. One or more of these individuals likely operate Coins of Change.
Coins of Change offers no retail products or services. Participants can only market affiliate memberships. These memberships provide access to an e-book and video course on bitcoin, along with a Facebook e-commerce course.
The compensation plan operates on a two-tier 3x5 matrix cycler. Participants gift funds to each other. A 3x5 matrix structure places an affiliate at the top, with three positions directly beneath them on the first level. Subsequent levels expand by tripling the positions from the level above. Levels three through five continue this expansion, with each level containing three times the number of positions as the preceding one.
An affiliate joins by gifting $50 to an existing affiliate. This action qualifies them to receive $50 gifts from new recruits. The matrix continues with increasing gift amounts at each level.
Gift payments across the 3x5 matrix are structured as follows:
Level 1: Gift $50, receive $40 from three affiliates.
Level 2: Gift $80, receive $70 from nine affiliates.
Level 3: Gift $280, receive $250 from twenty-seven affiliates.
Level 4: Gift $1000, receive $900 from eighty-one affiliates.
Level 5: Gift $5400, receive $4900 from two hundred and forty-three affiliates.
The second tier is called the "Gold Stage" and functions similarly to the first tier, but with different gifting amounts.
The lack of transparency regarding ownership and the structure of the scheme, which relies on gifting payments rather than the sale of legitimate products, strongly suggests a high risk of it being an illegal pyramid scheme. Such schemes typically collapse when recruitment slows, leaving later participants with significant losses.