On August 7, 2025, Lyconet, a key component of the Lyoness network, was declared insolvent in Europe, following myWorld’s insolvency earlier that week, as reported by BehindMLM. This marks a significant unraveling of the Lyoness ecosystem, which has been mired in controversy since its inception in 2003. The insolvency affects 43 employees and 565 creditors, with debts totaling €5.7 million, primarily owed to suppliers, according to Austria’s AKV creditor protection association. Unlike myWorld, which aimed for restructuring, Lyconet faces liquidation with no plans for recovery, per KSV. This development raises questions about the sustainability of MLM schemes in the crypto and cashback space.
Lyconet, spun off from Lyoness to handle its MLM marketing, operated alongside myWorld, the shopping arm, under the leadership of Hubert Freidl. The Supreme Court of Austria (OGH) in January 2025 reaffirmed that both entities continued Lyoness’s pyramid scheme legacy, as noted by FinTelegram. Court rulings across Europe, including in Norway and Switzerland, have labeled Lyoness a Ponzi scheme, citing deceptive recruitment practices over genuine retail activity. Financially, Lyconet’s €5.7 million debt reflects unpaid supplier obligations, while myWorld’s broader insolvency involves €22.7 million in liabilities against €15 million in assets, per Krone at. Freidl’s absence since September 2024, as highlighted in X posts by @MLMWatchdog, suggests a potential strategic withdrawal amid mounting legal pressures.
The insolvency of Lyconet and myWorld underscores the fragility of MLM models in the crypto-adjacent cashback sector. The FTC and European regulators, including Austria’s AKV, have intensified scrutiny, with Lyconet fined in 2024 for 47 illegal contract clauses, per ORF.at. The arrest of Lyoness’s managing director in Spain for €52 million in alleged fraud further tarnishes the network’s reputation. This collapse could deter investors from similar MLM ventures, as posts on X from @CryptoSkeptic warn of “systematic fund diversion” in Lyoness-linked entities. The market may see reduced confidence in crypto-related MLMs, with ripple effects on platforms like Cashback Universe, potentially increasing regulatory oversight under frameworks like the EU’s MiCA.
The liquidation of Lyconet likely spells the end of its MLM operations, leaving investors and marketers in limbo. The lack of restructuring plans signals a broader collapse of the Lyoness model, with creditors facing significant losses. Investors should avoid MLM schemes promising high returns through recruitment, focusing instead on transparent blockchain projects. Monitoring FTC and EU regulatory updates via sources like @ConsumerAffairs on X can help anticipate further crackdowns. While the crypto market remains bullish, with Bitcoin at $122,000, per CoinoMedia, MLM-linked ventures carry heightened risks. Diversifying into established DeFi protocols or NFT platforms, as seen in recent market surges, offers safer exposure to blockchain growth.
