Is Bitconnect a Scam?
Bitconnect allows our the lend out Bitconnect for immense profits - But is it a Scam?
This is not financial advice.
Bitcoin Trust and Savings:
http://insidebitcoins.com/news/trendon-shavers-bitcoin-ponzi-schemer-charged-40-million-fine/24716
It's true you cannot guarantee it is a pyramid until it falls apart.
Really good thoughts! I'm also very sceptical to bitconnect. Perhaps bitconnect does not lend out the Bitcoin but instead tries to increase value by trading them. I guess they are screwed then.
If they lend them out, who would borrow Bitcoin? Well that could be used for shorting Bitcoin if you are bearish. Borrow 1btc, sell it for $4200, market falls to $2000, buy it back and pay that BTC to bitconnect. That's a good profit but extremely risky.
Great job, thank you for informing the conmunity
It's very cool from your part to make all this research and share your thoughts and opinion with us. This can be an eye opener for many and can greatly benefit a lot of less educated people. Thank you, great job! Keep it up!
Just like you,I am so suspicious of bitconnect and I think very soon it will go burst. Am just questioning where all those profits come from. I would rather hold my crypto in a wallet :)
people don't care were the money come they just want to make money
Yeah that's a big problem with crypto. It's hard to understand and people just go with the flow
At their latest conference they did share with the participants where the money goes. 50% of it gets put into a pool that goes long BTC and long BitConnect tokens. Which is a blatant omission it is a pyramid scheme, just that is according to them, a pyramid scheme that gambles on BCC and BTC tokens. Clearly, though, if BCC or BTC tanked, since at least 50% of the funds are invested there (according to them), there would be absolutely no way to repay investors.
Start at 0:55 - "They amass huge amounts of bitcoin and are trading with it."
Video at 1:40 - they put 50% into BCC tokens
Source from a conference attendee:
I watched this gentleman's video last week, thought it was a great overview. As always, caveat emptor.
Thanks for the information!
This guy https://steemit.com/cryptocurrency/@crypto-p/is-bitconnect-a-scam copy paste you stuff on a daily basis (no resteem). More details here: https://steemit.com/steemit/@boucaron/theft-copy-paste-of-youtube-videos-from-steemians
The way that they work is extremely complicated. I actually don't think they are using ANY trading bots just actual humans. From what I have deduced this is how it works:
Anytime you do ANYTHING on the site you need to purchase their token
When you "Invest" you have to deposit Bitcoin and then purchase their BCC token
When you cash out you have to buy their token, since they only pay out fiat, and then you can trade it out for Bitcoin
Any money given to the site is split in two, half goes into reserve and the other half goes to the "trading bot"
On a bad trading day they pay out super low interest rates from their reserve
So basically their token is always on the rise from people constantly investing and reinvesting. Not to mention all of the new people joining from the referrals. Their token is growing faster than their daily interest rate payments these days so that also keeps them afloat. Last month their token was half the price it is now so any loans made one month ago have been paid roughly 30% back while they have made 100% on the crypto gains.
Its quite a genius scheme if you ask me since its a hybrid pyramid/Ponzi/HYIP with elements of real cryptocurrency overlaid and some really good developers and a very well put together website.
It doesn't make sense. If it's just a trading bot why aren't other people making more bots and duplicating money. What about trading losses. Why do you need to lock in your money for so long .. all these are question that can't be answered
I'm not sure whether or not Bitconnect is a scam or not, but making the lender hold their capital in the system does make sense. If everyone could withdraw their funds whenever the system wouldn't work. If everyone pulled their funds when things start to dip there would be a run on the system emptying out the "reserve" and potentially crashing the site. Just one of those safety net things I guess. (for them anyway)
It's the twist to make the pyramid scheme look legit. I'm not putting a penny in. Eventually the US government will crack down hard on this. People are going to prison. If you are part of bit connect DO NOT tell anyone online! A public record will add you to the list of indictments. It would be worse than advertising to people you distribute pirated movies.
Which is why Bitconnect remains anonymous of it's Founders. Also there are no Governments regulating Crypto which means if there would be a provable Market manipulation then who would be the one to pursue this lawsuit? As long as everyone is being paid what the were promised, nothing is going to happen in my opinion. There are not a lot of and especially realistic obstructions for Bitconnect to keep growing! As long as Blockchain and decentralized Technology grows, BCC thrives!! Long live Bitconnect.
I use BitConnect, but what I do is I go onto Nova Exchange, purchase BCC there then deposit it into BitConnect to invest, or put it into my desktop wallet to stake and build interest. I also mine it as well (its scrypt based) into my wallet then invest in it. You dont have to put Bitcoin into the site.