You may have heard of MMM if the scheme was popular in your country. The program was an initiative of a Russian Sergei Mavrodi who believed that money is imaginary and that through his scheme, people all over the world could move funds around to make it get to all and sundry.

MMM is in reality a ponzi scheme that was paying older participants with the contributions made by the new ones, sometimes paying percentages up to 100% in the belief that the inflow of the funds is unlimited.

A Vision To Change The World

The owners of the scheme actually believed they were on a mission to disrupt and destroy the current financial system as we know it thinking that the time would come when most investors would prefer the system in which money is earned, not from work but as a social donation thereby hoping to minify it as a means of transfer of value.

However, as expected, the scheme collapsed in most of those countries because it reached its elastic limit when inflow of new participants could no longer sustain the payments.

Ponzis Are Not Sustainable

The reason was that ponzi schemes are naturally unsustainable because you cannot get enough people to sustain them. Human resourced are limited just like any other.

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The effect is that the managers of the so-called social financial network were hard-pressed to keep making adjustments to accommodate the shortfalls of new influx of participants.

Ponzi For the Poor

It is worth noting that the majority of countries in which the scheme gained foothold were mostly in the southern hemisphere. These are countries such as Philippines, South Africa, Nigeria, India and Bangladesh where the scheme’s gospel of changing the world’s financial system gained foothold mainly because of poverty.

The central financial authorities in these countries did not help the cause of the scheme in that they routinely labeled MMM as scams and Ponzi, warning the participants that they would likely lose their funds.

Government Opposition

The managers and owners of MMM countered with statements asserting that the government didn’t want the people to be financially liberated. For instance, a letter allegedly written by the founder of the Ponzi, Sergei Mavrodi to the Nigerian government stated:

“What are you trying to get? Do you want the MMM System to collapse and millions of people to suffer? Who will support them then if now MMM is their only means of livelihood? Will you? You even don’t pay wages to people? Or might you not care about them? Might you be using a trendy topic to make a good name for yourselves? What will you say to a mother who will have no money to buy food for her child? Will you let her child die for the sake of the higher interests of the economy?”

Apparently, the government was concerned with the effects of having its populace ‘make money’ through the scheme without working, which may be interpreted to mean that people were being rewarded without work.

Serial Collapse

By 2017, the scheme had mostly collapsed in virtually all the countries where it one held sway. With millions of dollars in investment lost, the participants nursed their wounds and moved on.

However, there seems to be efforts at reviving the scheme in some of these countries just a couple of years after the collapse. The Ponzi has shown resilience in terms of having a core inner group called the guiders who have implicit confidence in the scheme.

The reason is that these guiders are paid a lot of commission for bringing in new participants. They’re also permitted to form their own network and downlines just as applicable in multi-level marketing business.

So they practically have little to lose in terms of invested funds but a lot to lose if the scheme fails. Apparently, the revival of MMM is the handiwork of these guiders.

How It Worked

The MMM scheme attracted a lot of participants because it promised and actually delivered returns as high as 100 percent in some countries. Others rewarded depositors with 50 percent or 30 percent monthly.

Many did not believe that this was possible but with the persistence and insistence of the trained guiders, the scheme gained tractions in a matter of months.

A New Source of Strength

With the advent of cryptocurrencies, the Mavrodi Mondial Moneybox utilized the mantra of decentralization and taking financial control out of the hands of central governments as a new vision.

Not surprisingly, this resonated with the low income class which flooded the scheme in these countries. The operators believed they could use Bitcoin as a means of forming an international version of the program.

The original MMM which Mavrodi started in Russia has since morphed and been refined and adapted to many versions, most times made country-specific and at other times, global.

There has beem MMM South Africa, MMM Global, MMM Nigeria and that of many other countries such as Philippines and India. Most recently, in the quest to revive the scheme, MMM Coorporation has been seen in some countries.

It is not yet clear how these new versions would fare. What is obvious is that the lure for quick money is real and people would always be tempted to join Ponzi schemes with the hope that they would make some profit before it collapses.

Drove Bitcoin Adoption

One of the impacts the MMM ponzi made among developing countries was help drive Bitcoin adpotion. The managers realizing the different governments had hardline policies towars the scheme worked towads circumventing the authorities by introducing bitcoin payments.

In the meantime, the quest for revival may not be easy on the scheme with more people getting informed. Nevertheless, Ponzi schemes are a  financial hazard that must be resisted and avoided because it mostly favors the founders and other early birds at the top of the structure, in this case the guiders of MMM.

Better Investments

There are better ways to invest ones money in whatever form you have it. Whether Bitcoin or fiat, this is why we refer people to our top recommendation for investment.

Always go for investments that are safe and regulated. Ponzi schemes are designed to benefit some early participants and the owners before failing. Your funds should not be gambled away.

If you have views about this scheme and other ponzis, please use the comment box below.