Rohit Sharma, Magda Karapetyan, Azad Mohammad, and Haider Mustafa launched Linxella, a cryptocurrency investment scheme, in July 2023. Three of the four co-founders previously promoted the collapsed NexGen Ponzi scheme in the United Kingdom. Linxella's official website provides no ownership or executive information, a common characteristic of high-risk investment platforms.
The Linxella website domain, "linxella.io", was privately registered on July 31, 2023. This private registration obscures the identities of its true administrators and operators, making due diligence difficult for potential investors. Public social media profiles, however, identify Sharma and Karapetyan as being in a relationship, with all four listed co-founders having a history as UK promoters for NexGen.
Michael Tornquist and Merja Laiho also feature prominently in Linxella's operations. They appear to direct recruitment efforts for the scheme across Europe. Their roles suggest a structured approach to expanding Linxella's affiliate base beyond its initial UK connections.
The UK Financial Conduct Authority (FCA) implemented a ban on MLM cryptocurrency investment schemes, effective October 8, 2023. This regulatory action directly impacts the legality of operations like Linxella within the UK. Any continued promotion or participation by UK residents in such schemes now falls under specific regulatory prohibitions.
Linxella's marketing promotions frequently display UAE time, hinting at ties to Dubai. Dubai has gained a reputation as a hub for multi-level marketing (MLM) fraud, largely due to minimal enforcement of securities fraud regulations. This environment allows numerous crypto Ponzi schemes and similar financial frauds to operate with relative impunity, attracting promoters and operators from around the globe.
The Linxella platform offers no retailable products or services. Affiliates primarily market the Linxella affiliate membership itself, a hallmark of pyramid schemes. Participation requires affiliates to invest tether (USDT) into internal "LCSP points", with the company claiming one LCSP point equals one USDT.
Linxella advertises passive monthly returns ranging from 3% to 10% on these investments. The investment contracts run for 40 months. At the end of this period, Linxella retains the initial investment, a structure that effectively functions as a long-term loan to the scheme with no capital return.
Investment tiers begin at 500 USDT, escalating significantly through 1,000 USDT, 5,000 USDT, 10,000 USDT, 50,000 USDT, 100,000 USDT, 500,000 USDT, and reaching up to 1,000,000 USDT. Each tier promises the same percentage-based returns, encouraging larger investments.
The MLM component of Linxella's compensation plan focuses on affiliate recruitment. Affiliates earn commissions by recruiting new investors into the scheme. This structure forms the basis of eleven affiliate ranks, each requiring specific investment levels and recruitment targets.
For example, an "Affiliate" simply signs up and invests. A "Planner" must invest at least 1,000 USDT, recruit two new affiliates, and generate 25,000 USDT in total downline investment volume. The "Coordinator" rank demands a 5,000 USDT investment, four recruited affiliates, and 100,000 USDT in downline volume.
Higher ranks impose even steeper requirements. A "Contributor" invests 10,000 USDT, recruits eight affiliates (two of whom must be Coordinators or higher), and achieves 500,000 USDT in downline volume. A "Manager" requires a 50,000 USDT investment, sixteen recruits (four of them Contributors or higher), and 2,500,000 USDT in downline volume. The "General Manager" rank maintains a 50,000 USDT investment, recruits thirty-two affiliates (four of them Managers or higher), and must generate at least 10,000,000 USDT in total downline investment volume. These escalating requirements incentivize continuous recruitment and larger investments, fueling the Ponzi structure.
The UK Financial Conduct Authority maintains a public register of unauthorized firms, which investors can check before committing funds to any investment opportunity.