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RE: A Tale about Bitconnect ( or should you invest ? Spoiler : NO! )
I really want someone to tell me how Bitconnect makes money if it is not a ponci scheme?
- Like how does the bot work? Winning rate/edge?
- How do they actually loan money to the individual or companies?
- How do they handle clients that default on their loans?
I really want to know so I can invest without fear.
It trades volitity. And that goes both ways. It makes money on down days, and up days. It doesn't make money on days that Bitcoin doesn't more. There have been days of 0% returns because of it.
They make .0025% on the internal market. When you sell your BCC to get BTC they take .0025% of that trade. Same a Bittrex and other markets.
They don't loan out to clients. YOU loan money to them. If you lend them $1000, you get the equivalent of $1000 at the end.
They also make money on their debit card, again charging .0025%
They also seem to make money by combining BTC transfers. When I transfer BTC out of Bitconnet I notice that my transfer is bundled with other transfers. Bitconnet charges me 0.0004 BTC transfer Bitcoin out. They are then combining my transfer with 10-20 other transfers.
Then they make money with the trading, they take the money I lend them and then share the profits with me.
Thanks for the info.
I'm not 100% sure, but I would say that if there is a bot which is a big if at this stage. I think it works more like a market maker. By always there to offer a price to buy or sell. They profit from the spread between the two. With such a big trading arsenal in the form of investors deposits, its not beyond the realms of possibility as to how they generate their income. Also don't forget the income it receives from the trading of its coin within the platform's internal market. These fees are not insignificant considering how many investors are on the platform.
Thanks for the Input!
I don't think there are clear answers to your question as many people are wondering about their bot
Thanks for the reply...
I just don't want to miss out but their site really does not state how exactly they work. And all those they say are legit are earning more on referrals than the actual lending part...
Imo that is saying a lot if it is legit or not.
I know that FOMO feeling and believe me I regret it giving in.