Is Karatbars still in business? That is a question many US investors are asking today, especially those who once followed its gold-backed crypto offers and multi-level marketing model.
Karatbars International promised a blend of precious metals and digital currency, wrapped in a business opportunity. But over time, legal issues, failed crypto projects, and global regulatory bans have cast serious doubt on its legitimacy.
In this article, we break down what really happened, why it matters, and how to protect yourself from similar schemes.
You will also find smarter, more reliable paths to building your business or investment strategy, with tools like our Entrepreneurs Success Blueprint and premium resources available in our shop.
Key Takeaways
- Karatbars International is no longer in business due to regulatory bans, legal issues, and the collapse of its unlicensed gold-crypto model.
- The KaratGold Coin failed to deliver on its promise of being gold-backed, leading to investor losses and the token’s decline in value.
- Reviews from US investors revealed complaints about withdrawal failures, recruitment pressure, and lack of transparency.
- Safer alternatives exist through regulated gold investments, SEC-compliant crypto platforms, and proven business tools like the Entrepreneurs Success Blueprint.
See also: Is Thomasville Furniture Still in Business?
What Is Karatbars International
Karatbars International was a Germany-based company founded by Harald Seiz, known for combining precious metals with multi-level marketing.
The company promoted the idea of making gold ownership accessible through small gold bars, with added income opportunities for those who referred others into the system.
This combination attracted interest from US investors seeking alternative assets and passive income streams.
As it evolved, Karatbars introduced KaratGold Coin (KBC), a cryptocurrency it claimed would be backed by physical gold. The token was heavily marketed as a financial revolution, one that would allow users to convert digital coins into real gold.
At the surface, it sounded appealing, especially during times when distrust in fiat currency and traditional financial institutions ran high.
To support its ecosystem, Karatbars launched platforms like the Karatbit exchange and promoted gold-linked ATMs. The company even hinted at building a global economy around gold and blockchain.
But much of this never materialised as promised. Investors began to notice delays, vague whitepapers, and inconsistent communication, raising red flags.
The business model relied on new sign-ups purchasing gold or tokens, with existing affiliates earning commissions.
This structure mirrored that of typical MLM operations, which are legal in many cases but often attract regulatory attention when income depends more on recruitment than on real product value.
Here is a simple breakdown of Karatbars’ core offerings and how they were positioned:
| Product/Service | Description | Investor Appeal |
|---|---|---|
| Small Gold Bars | Fractional gold bars sold via direct sales | Affordable access to gold ownership |
| KaratGold Coin (KBC) | Crypto token claimed to be gold-backed | Promised security, liquidity, and growth |
| Karatbit Exchange | Trading platform for KBC and other tokens | Claimed to support a full digital economy |
| MLM Commission Structure | Multi-level rewards based on referrals and sales | Attracted those seeking passive income |
For many, this business seemed like a unique way to invest in gold and crypto while building a network. But as you will see in this article, regulatory action and failed promises began to unravel that image.
Is Karatbars Still in Business
Karatbars International is no longer in operation. Despite its early promise of gold-backed cryptocurrency and passive income through an MLM model, the company faced regulatory actions, customer complaints, and loss of credibility across multiple markets.
Its websites have gone offline, support channels are inactive, and no known legal operations remain.
Global financial authorities issued warnings about Karatbars’ business model and unlicensed crypto activities. These actions forced the company to cease most of its operations.
In the US, Karatbars was never registered with the Securities and Exchange Commission (SEC), which raised concerns about its compliance with financial regulations.
Several attempts were made to relaunch the brand under different names like Freebay and V999, but these efforts failed to rebuild trust or deliver on previous promises. Investors were left without refunds, and affiliates without commissions.
Regulatory Warnings and Actions
Below is a summary of the regulatory positions against Karatbars International:
| Country | Authority Involved | Action Taken |
|---|---|---|
| Germany | BaFin | Cease-and-desist for issuing electronic money |
| Namibia | Bank of Namibia | Declared it a pyramid scheme |
| South Africa | FSCA | Issued public warning, unauthorised to operate |
| Canada | Alberta Securities Commission | Unregistered securities trading |
| New Zealand | Financial Markets Authority | Caution issued, not authorised |
Each of these actions highlighted either regulatory violations or investor protection concerns. In the US, similar MLM-crypto hybrids have come under scrutiny for misleading marketing and illegal securities sales.
The company’s reliance on constant recruitment, vague gold backing, and unstable token value led to widespread loss of confidence.
The KaratGold Coin (KBC), once central to its offering, collapsed in value and was eventually delisted from major exchanges.
For anyone searching “is Karatbars still in business”, the clear answer is no. The brand has been shut down, and what remains are scattered rebranding attempts and unresolved investor complaints.
See also: Is Koppen Clothing Still in Business?
Timeline of Karatbars Legal Troubles
Karatbars International attracted legal attention across multiple countries due to unlicensed financial activities, questionable crypto promises, and a business model that mirrored pyramid schemes.
These issues led to a global series of warnings, bans, and shutdowns that eventually ended its operations.
Early Warnings and Regulatory Red Flags
The first signs of trouble appeared when financial regulators started questioning the legitimacy of Karatbars’ gold-backed cryptocurrency claims and MLM practices.
| Year | Event | Description |
|---|---|---|
| 2019 | BaFin warning in Germany | Ordered Karatbars to halt e-money issuance tied to KaratGold Coin |
| 2019 | FSCA alert in South Africa | Declared Karatbars unauthorised to offer financial services |
| 2019 | Bank of Namibia ban | Labelled the company a pyramid scheme and banned operations |
| 2020 | FMA notice in New Zealand | Warned public about unlicensed status and investor risk |
| 2023 | Alberta Securities Commission | Issued alert for illegal securities promotion in Canada |
These actions followed a pattern. Karatbars used aggressive affiliate marketing and crypto assets to promise wealth, without obtaining proper licensing in any of these countries.
KaratGold Coin and the Crypto Collapse
The KaratGold Coin (KBC) was promoted as a revolutionary gold-backed token. It was supposed to be convertible into physical gold, providing both asset security and liquidity. However, the infrastructure never supported this promise.
| Claim Made by Karatbars | What Happened in Reality |
|---|---|
| KBC would be backed by gold | No independent audit confirmed this backing |
| Users could withdraw gold | ATMs and redemption mechanisms failed to work |
| Token value would rise | KBC lost over 95% of its value |
As the crypto space matured, it became clear that Karatbars lacked both technical execution and regulatory compliance. Many US investors who joined expecting asset-backed returns were left with devalued tokens and no support.
Failed Rebranding Attempts
After regulatory pressure forced Karatbars out of many regions, it attempted to re-emerge under different brand names, including Freebay and V999.
These platforms recycled the same narrative: digital assets tied to gold, referral incentives, and global expansion promises. But none gained traction.
| New Brand | Strategy Used | Outcome |
|---|---|---|
| Freebay | Repositioned KBC offering | Short-lived, no traction |
| V999 | Claimed real gold token | Never delivered results |
Each rebranding lacked transparency and failed to rebuild trust. Instead of solving existing issues, they raised further concerns about regulatory evasion.
Why Did Karatbars Collapse
The collapse of Karatbars International was caused by a combination of regulatory violations, unsustainable business practices, and broken investor trust.
Its model depended heavily on continuous recruitment, token hype, and vague claims about gold-backed assets. Once scrutiny increased, the foundation quickly crumbled.
Unlicensed Financial Activities
Karatbars operated across borders without obtaining the necessary licences to sell financial products. In the US, it did not register with the SEC or FinCEN. This exposed investors to high risk with no legal protections in place.
| Financial Violation | Consequence |
|---|---|
| Issuing e-money without licence | BaFin shutdown and cease order |
| Selling unregistered securities | Multiple investor alerts worldwide |
| Misleading financial claims | Triggered investigations and bans |
In most jurisdictions, financial products must be registered and regulated. Karatbars ignored these laws while targeting retail investors globally, including those in the US.
Misleading Token Promises
KaratGold Coin was at the centre of Karatbars’ crypto offering. It was advertised as a gold-backed token but lacked the transparency, infrastructure, and convertibility needed to support such a claim.
| Claim | Reality |
|---|---|
| Token backed by physical gold | No independent verification or redemption |
| Gold ATMs worldwide | Failed to launch or remain operational |
| Rising token value | KBC lost almost all value post-ICO |
Without real gold storage or blockchain functionality to support it, the token lost credibility. Investors who joined expecting wealth through crypto found themselves holding assets with no liquidity or use.
Pyramid-like Revenue Model
Much of Karatbars’ income came from affiliate recruitment rather than product sales. This is a typical sign of a pyramid scheme. In some countries, this led to the company being banned outright.
| Revenue Source | Description | Risk |
|---|---|---|
| Affiliate recruitment | Commissions earned from new members’ purchases | High |
| Product value | Limited gold resale or use of KBC tokens | Low |
| Subscription models | Created recurring income for top-level members | Unstable |
A business cannot survive on recruitment alone. When the inflow of new participants stopped, so did the company’s ability to sustain payouts and maintain operations.
No Accountability or Customer Support
After the collapse, many investors and affiliates were left without updates or recourse. Customer support was unresponsive, platforms shut down, and complaints were ignored.
In contrast, a real business offers customer service, dispute resolution, and transparency. These were absent at Karatbars International.
Is Karatbars a Scam or Just a Failed Business
Karatbars International was never officially classified as a scam by US authorities, but its operations matched the red flags often associated with fraudulent schemes.
It combined unregistered financial promotions, unrealistic investment promises, and an MLM model focused more on recruitment than product value.
Key Indicators of a Scam Structure
| Red Flag | Seen in Karatbars |
|---|---|
| Unlicensed investment products | Yes |
| Guaranteed returns or token growth | Implied through marketing |
| Recruitment-based income | Core revenue model |
| Vague or unverifiable claims | Frequent |
| Poor customer support | Common complaint |
In several countries, regulators identified Karatbars as a pyramid scheme or warned that it posed a serious risk to investors. For example, Namibia banned it, and Germany’s BaFin enforced a shutdown order.
While not every failed business is a scam, Karatbars showed patterns that led to investor losses and regulatory action. US investors who joined looking for a reliable gold or crypto opportunity were left with devalued assets and no support.
Karatbars Reviews and Complaints in the USA
In the US, Karatbars received numerous complaints from users who reported loss of funds, misleading marketing, and non-existent support.
Reviews on consumer forums and watchdog sites consistently flagged issues with transparency and credibility.
Common Complaints from US Investors
| Issue Reported | Description |
|---|---|
| Withdrawal failures | Users unable to access funds or convert tokens |
| Misleading income claims | Promises of passive income not delivered |
| Unresponsive support | No follow-up after complaints or delays |
| Platform shutdowns | Websites and apps became inaccessible |
On platforms like Trustpilot and the Better Business Bureau (BBB), users expressed frustration over the collapse of Karatbars’ systems and lack of accountability.
Some affiliates also claimed they were encouraged to recruit without being told of the legal risks or regulatory gaps, exposing them to financial and reputational damage.
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Warning Signs to Avoid Similar MLM Schemes
Many investors drawn to Karatbars were persuaded by promises of passive income, gold-backed tokens, and simple wealth-building.
These are common tactics in MLM schemes that prioritise recruitment over real value. To avoid similar risks, it is important to recognise the signs early.
Red Flags of Fraudulent Investment Platforms
| Red Flag | Why It Matters |
|---|---|
| No SEC registration or licensing | Unregulated offers carry high legal risk |
| Guaranteed profits or fixed returns | No legitimate investment can guarantee returns |
| Emphasis on recruitment over product | Common trait of pyramid schemes |
| Complex compensation plans | Designed to confuse and hide real value flows |
| Token or crypto with no use case | Often used to inflate perceived value |
| Pushy sales tactics | High-pressure strategies indicate instability |
| Limited or no customer support | Signals a lack of accountability |
| Anonymous leadership or vague bios | Makes it hard to assess credibility |
These traits often appear in MLM-style cryptocurrency and gold investment platforms that collapse once new member growth slows down.
How to Verify Before You Invest
| Step | What to Look For |
|---|---|
| Check regulatory registration | Use SEC’s EDGAR or state securities databases |
| Research the founders | Verify identity, track record, and history |
| Understand the product | Ask: is this valuable without recruitment? |
| Request a business model explanation | Legitimate ventures are clear and transparent |
| Search for third-party reviews | Look beyond company testimonials |
If you are building a business or launching a product, grounding it in clarity and compliance is critical. Tools like our Entrepreneurs Success Blueprint can help you create a transparent, scalable model built for real-world results.
Safer Alternatives to Karatbars-Style Investments
For US investors seeking stability and transparency, regulated investment platforms and licensed brokers offer far more security than MLM crypto hybrids. Avoiding high-risk schemes begins with choosing products and services built on compliance and clarity.
Gold Investment Alternatives
| Option | Key Features |
|---|---|
| Physical gold bullion | Purchased from licensed dealers; stored securely |
| Gold ETFs | Traded like stocks; backed by physical gold |
| Gold IRAs | Tax-advantaged accounts holding approved bullion |
These options are regulated and can be verified through trusted institutions and custodians.
Cryptocurrency Alternatives
| Option | Regulatory Status | Use Case |
|---|---|---|
| Bitcoin or Ethereum | Traded on regulated exchanges | Widely accepted, high liquidity |
| Stablecoins (e.g. USDC) | Pegged to fiat, audited | Suitable for transfers and savings |
| SEC-compliant crypto ETFs | Backed by regulated firms | Institutional-grade investment option |
Always use exchanges that comply with US laws, such as Coinbase or Kraken. Check for proper licensing and proof of reserves.
Before investing, define your goals and choose assets that match your risk tolerance.
Conclusion
Karatbars International is no longer in business. Its operations collapsed after facing regulatory bans, failed product delivery, and widespread investor complaints. For US investors, the warning signs were clear- unlicensed offerings, token hype, and a recruitment-heavy model.
If you are searching for ways to grow your wealth or build a business, avoid shortcuts that lack substance. Focus instead on transparent, legally sound platforms and tools that deliver measurable value.
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Frequently Asked Questions About Karatbars International
Is Karatbars still in business?
No, Karatbars International is no longer operational. The company ceased its activities following regulatory actions from authorities in Germany, South Africa, and other countries due to concerns over its business practices and unlicensed financial operations according to coindesk.com
What was Karatbars International?
Karatbars International was a Germany-based company that offered small gold bars and promoted a gold-backed cryptocurrency called KaratGold Coin (KBC).
The company operated using a multi-level marketing (MLM) model, encouraging individuals to recruit others into the program.
Was Karatbars a scam?
While Karatbars International was not officially declared a scam by US authorities, it exhibited characteristics commonly associated with fraudulent schemes, such as unlicensed investment offerings and a compensation structure heavily reliant on recruitment.
What happened to KaratGold Coin (KBC)?
KaratGold Coin (KBC) was promoted as a cryptocurrency backed by gold. However, regulatory investigations revealed a lack of evidence supporting this claim.
Consequently, the coin’s value plummeted, and it was delisted from major cryptocurrency exchanges.
Can I recover my investment from Karatbars?
Recovering investments from Karatbars International is highly unlikely. The company’s assets have been liquidated, and there is no official channel for investors to claim refunds.
Affected individuals are advised to report their experiences to the appropriate regulatory authorities.
Were there any legal actions against Karatbars?
Yes, several regulatory bodies issued warnings and took legal actions against Karatbars International. For instance, Germany’s BaFin ordered the company to cease its operations, and similar actions were taken by authorities in South Africa and Canada.
Is there any connection between Karatbars and Freebay or V999?
After facing regulatory scrutiny, Karatbars attempted to rebrand and launched platforms like Freebay and V999.
However, these ventures failed to gain credibility and were met with skepticism due to their association with the original company.
What should I do if I was approached by a similar investment opportunity?
Exercise caution and conduct thorough research before investing. Verify the company’s registration with financial authorities like the SEC, and be wary of schemes that promise high returns with minimal risk or rely heavily on recruitment.
Are there legitimate alternatives to investing in gold and cryptocurrency?
Yes, there are reputable avenues for investing in gold and cryptocurrencies. For gold, consider purchasing from accredited dealers or investing in gold-backed ETFs.
For cryptocurrencies, use regulated exchanges and focus on well-established coins like Bitcoin and Ethereum.
How can I stay informed about safe investment practices?
Staying informed is crucial. Subscribe to our newsletter for regular updates on legitimate investment opportunities and strategies.
Additionally, explore our Entrepreneurs Success Blueprint and other resources available in our shop to build a solid foundation for your financial ventures.
