The BitConnect Whitepaper - Maths of a Ponzi

in #bitconnect6 years ago (edited)


BitConnect has no whitepaper, so I decided to draft one for them.

An Introduction to Absurdity

From my last video, I was especially surprised at the number of people on YouTube and Steemit who are still on the fence with bitconnect. Some people, who are heavily invested are defending it. I think it is hard to have a clear head about it unless we have something concrete to look at besides subjective evidences. To this point, I will do math and analysis of the BitConnect system.

Since May 26th, 2017, a person who deposited a loan of $1,140 would have received $871.81 in earnings up through August 3, 2017. This is 69 days, with an average percentage paid of 1.1% a day. This is data, pulled from the system, without using reinvesting or referrals.

A lot of critics of BitConnect, I will say you have not done your research and are ignorant. BitConnect's popularity is that this ponzi permits you to withdraw that money. The full $871.81 was available for withdrawal from BitConnect's system. When you go on and on about how only people who do referrals are making money with the system, while this is partially true, I have no doubt that there are pure lenders with no referrals who are sitting in the green, especially if they started in early May. Arguing from ignorance does not help convince people.

So then, what is wrong with BitConnect? Let's do the math on the data above. A lot of people say BitConnect pays 0.9% interest daily. The hard data above taken from their system proves otherwise. However, that loan was above 1k, which adds another 0.1% daily interest to the loan. Many loans in the system are paying an additional 0.1%, 0.2% and 0.25% above the standard rate. Due to this, for the sake of this analysis I will just use a flat 1.0% interest rate. It is perfectly reasonable considering the hard data above demonstrating it is exactly 1% since May. This ignores all the people will higher-tier loans that will throw this over 1%. Let's get to the numbers then:

The Numbers - Compounded Weekly on $10,000 initial investment

10k invested in Bitconnect, in 1 year, compounded weekly interest provides: $337,253
10k invested in Bitconnect, in 2 years, compounded weekly interest provides: $11,373,990
10k invested in Bitconnect, in 3 years, compounded weekly interest provides: $383,591,803
10k invested in Bitconnect, in 4 years, compounded weekly interest provides: $12,936,767,066

There are 1,826 billionaires in the world, but lookout world, the infinite money machine BitConnect was invented!!! Here come thousands of people into your ranks!

10k invested in Bitconnect, in 6 years, compounded weekly interest provides: $14,714,267,184,649

Those are trillions. BitConnect then will be the system to create the world's first trillionaires in just 6 year's time... or it is a ponzi just like I have been saying.

The Numbers - Compounded every 2 days on $10,000 initial investment

On $10k invested, a person can compound interest daily because they will receive $100 per day in interest. The minimum to reinvest with BitConnect is $100. Now there are days where you would not be able to compound due to the low payout on some days. Yet other days have payouts well above 1%. Therefore, I will compound interest every 2 days for this analysis.

In 3 years, they will have $500 million dollars.
In 4 years, they will have $18 billion dollars.
In 10 years of using this amazing trading bot, they will have $49 quintillion dollars.

The entire US Housing Market is worth just $30 trillion dollars. I anticipate a bought of hyperinflation due to the BitConnect wealth creating system!

Absurdities aside, let us delve further into this ponzi.

The BitConnect Whitepaper - Maths of a Ponzi

This part of the post is conjecture, but it is good conjecture because often the best solution to a problem is the easiest answer. If we want to know how BitConnect has kept this amazing ponzi operational, and how it may continue to operate going forward, this is my proposal on how the system operates.

Part I - Reducing Circulating Supply

This picture shows the basic mechanic of the ponzi:

Bitcoin buys BCC, and BCC gets put into lending as "Dollars".

... What a minute!?! Where does BitConnect exchange the BCC token you lend them for US Dollars?

The dirty little secret of BitConnect's system is that they likely never exchange your BCC tokens for dollars. They just keep hanging onto the BCC token. If BitConnect wanted to truly exchange the BCC you lend them back into US Dollar fiat, they would first have to sell those BCC tokens on their internal exchange for Bitcoin, and then exchange the Bitcoin for fiat dollars. This would create 2 expensive transactions for them. Furthermore, it is in their advantage never to do this exchange back into Bitcoin or fiat.

If you buy 10 BCC tokens, give them to the lending bot ponzi, and the lending bot ponzi sells those 10 BCC tokens for Bitcoin, the net market affect is very minimal to the upside, but basically neutral. 10 tokens were bought, held for a short period of time, and then 10 tokens were sold. In math terms, we might say: 10(bought) - 10(sold) = 0

This is the key to their ponzi. If only some of those tokens are sold by the lending bot, this creates a net drain of BCC tokens on the market. 10(bought) - 5(sold) =5(tokens removed from circulation)

People who understand economics, and the supply and demand curve, we know that if you reduce supply of something, this generally favors increasing prices. This is especially the case if the underlying asset has true demand. Demand for BCC tokens for their lending system, combined with ever decreasing supply, favors an increase in price for BCC tokens.


Unlike many other cryptos that operate on boom and bust cycles, BCC has not operated in this manner. The worst bust cycle it faced was going from $11 USD to $5USD during April. In fact, BCC tokens for this chart period beginning on January 20th, 2017, have seen an increase from $0.14 to $77 USD per token. This is an increase of 550x or 55,000%.

Now I will use my original loan example, but rather than describing it in terms of USD which the BitConnect system never uses, I will describe what occurred in terms of BCC tokens which describes the reality of the situation actually happening.

Ponzi with Tokens Model

On May 26th, 75 BCC tokens were deposited into the lending wallet.

During the period up through August 3, "lending earnings" of $871.81 were accumulated, but if we describe these earnings in BCC tokens withdrawn today, and not dollars, only 11 BCC tokens were earned!!!

When we describe this situation in the fictitious dollars example, the year-to-date return on investment would be 76%.

When we describe this situation in terms of the tokens, which is the real situation, year-to-date return on investment would be only 14%. Now certainly, the earnings could have been withdrawn sooner, but had they been left in the lending wallet, this would be the actual situation as of today.

With BitConnect's token magic, 1% daily return transforms into 0.2% daily return in this example.

This means, by limiting BCC coin supply while driving more and more people to the system, this creates a drastic net-demand with ever reducing supply of BCC tokens, forcing the price of the token higher. Then as they are "paid earnings", they receive back a much smaller amount of the tokens initially invested, than the quoted 1% rate.

What this mechanism does, is that it delays the inevitable, and keeps the ponzi going far longer than it otherwise could operate if they truly held USD fiat in the lending wallet.

As long as the net token supply is reduced, the BitConnect operators are content to drain some of those funds to pay affiliates and pay themselves. Meaning, for every token invested, a certain percentage of those tokens are never resold but sit accumulating in the BitConnect system, continually reducing the supply.

Part II - Closed Market Manipulation

90% of all BCC tokens are traded on their internal exchange.

This gives the operators much power in terms of decision making, and legitimate traditional models of trading and manipulation of markets. For example, it may be they have procedures on how to assist the market in going higher.

Certainly, when they issue sell orders for the % of BCC they are willing to sell, they are issuing that as a limit sell order, forcing people to bid-up in order to tap into their token reserves. If they move their bar higher, eventually people will have to pay those higher prices to get their BCC tokens into the lending system. It could also be that they are willing to use outside pools of bitcoin to prop up prices at key moments in trading, it probably is not needed, but it is certainly doable.

Part III - The House of Cards

As an ingenious as this ponzi system is, for making it look like we are getting rich when in fact it is all due to the limiting supply of a token, there comes a breaking point in this model.

There comes a juncture where compounding interest overwhelms price appreciation of the BCC token.

If we analyze a situation without compounding interest, we can assume the following:

$10,000 invested over the period of 1 year at 1% daily interest, should produce a return of $36,500 interest earnings. We need to add the initial investment to this as well. This would be $46,500, available for withdrawal at the end of 1 year, in a simplified example case.

To invest 10k today, we would deposit 129 BCC tokens. To withdraw exactly our deposited tokens at the end of 1 year, the price of BCC would need to be $46,500 / 129 = $360 per token. However, it would need to do better than that simply because of referrals and other payouts BitConnect internally takes. $360 per token in 1 year would put the total market capitalization of BitConnect's token at 2 billion. This would be needed to repay holders if everyone invested according to this behavior.

That said, if investments are compounded as many people have started doing, the situation for BCC becomes dire.

In the weekly compounding of 10k I gave above, we know that the full balance after 1 year would be $337,253 (including principal). The catch here is that the person compounding, could not withdraw that $337,253 from the system immediately. Such withdrawals would be spread out over the course of another 300 days. Therefore in the 1 year plus the 300 days of divestment, the price of the BitConnect token would need to be: 337,253 / 129 = $2,614 This would permit them to withdraw their balance, while that balance being exactly the same number of tokens they originally invested.

At a price of $2,614 per token, with 6,365,000 coins in circulation, the market capitalization of BCC becomes 16 billion. Unlikely, but doable.

If we take this same model out 6 years + 300 days of divestment: 14,714,267,184,649 / 129 = $114 million per BCC token.

6,365,000 coins X $114 million per token = 725 TRILLION

Within 7 years time then, the market capitalization of BitConnect needs to reach 725 trillion for there to be any hope of recouping funds invested.

Sustainability Goals for BCC Token

From this sort of analysis, we can create a financial model, to model the prices BitConnect aught to reach to have any hope of maintaining eco-system sustainability.


BCC has met its sustainability goal so far this year by growing 55,000%. It needs to continue this level of expansion going forward and overtake all other cryptocurrencies to be a long-term sustainable ponzi. The growth continues on into absolute absurdity where BCC token surpasses the US housing market in 4 years.

Part IV - Why is there no trading bot?

  • All investments entail risk. BitConnect offers 1% average daily return with zero risk. There is no clause where the bot has a bad day and you lose 5%. This never happens.

  • All investments have thresholds of capital limitations. If I enter an order to buy $50 million dollars worth of Bitcoin on the market, do you see the problem? $50 million bought rapidly in bitcoin would move the market for bitcoin, increasing the price of bitcoin on the exchanges. The point here is, maybe an amazing bot could produce a solid daily return. Then as it gets more and more millions fed into it, that bot will produce a lower and lower return. As it tries to buy that $5 mil chunk of bitcoin with the latest money move in their system, the bot would move prices higher on the markets. Then people would sell against its order, and the bot would be sitting on losses. When you invest a small amount, big things are possible, as you invest millions, your possibilities of what you can do dwindle greatly. Orders take longer to fill, you do not get to be as nimble with your money as day-traders are. You become the wale, instead of trading off the waves the whales make. If BitConnect's bot was real, it would have started producing diminished returns due to this phenomena in trading. Rather, if anything, returns have increased, combine this factor with zero risk which a real bot does not have and we see the problem.

  • The absurdities outlined above are the final say in how a trading bot cannot produce 1% daily returns on average. It violates economic laws. Their model only works when you take a very small crypto, and let the price spike 55,000% on exchanges. This has occurred so their model has been sustainable. Now, as time goes on and BCC fails to increase 55,000% every half year, their token ponzi fails. Money invested will not be available to divest, since the BCC tokens divested will be insufficient to pay the balances of the compounded interest in the lending wallets.


BCC existing does not bother me too much. The 101 people lying about hard facts is what bothers me. That 50% of the people in the comments section are deceived bothers me. There is nothing to be deceived about, math is math.

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One of the best articles regarding bitconnect. The problem is people lose their judgment when it comes to earning money. Greed is very powerful. Soon a lot of people with 6 digit accounts will realize how fast money can dissapear.

You got my vote and a resteem :]

Awesome post with a lot of example than you :)

I use bitconnect and I know it is a ponzi scheme. It was clear when I started;by now I almost got my investment back, havent compounded at all. From next week I wont even care if they go bust or not and that will be the moment I will start compounding.
Anyway, if theyre going to achieve their roadmap objectives this month it will give them another boost; it is unsustainable though.

Although I use it, I do not promote it at all, I dont feel comfortable with that, it's one thing to gamble my money, different thing alltogether to tell a friend to put their money in; so I am at 0 refferals.

Thanks for the math. Too bad I havent held on to the bcc I initially purchased, that would have worked out way better for me.

" Yeah so I supported this ponzi scheme to get free money and I know people are gonna lose money but don't care about bag holders because I got my money".

That's why the justice system goes after ponzi schemes.

Suspension of ethics is just too easy for our brains.

Yeah I just realised it's way profitable to transfer all your earnings to bcc, and price is soaring now. I'm also going to stop in investing anything once my profit reaches the original investment. But I still have a month to go... :D

I'm almost there with getting my investment back; for about a week now I stopped taking the interest out as BTC and just kept it in BCC and with the soaring price that made quite a bit of difference. I have to be honest, the site being unavailable most of the day today made me feel a bit uneasy :D

Yeah.. the site will be down spontaneously. And no one even mention it on twitter or blog. Hmm I really wonder how long this scheme can last. :D

Loading... you called it! crashing hard right now.

hahaha , all such people remind me of creatures who try to explain away their Creator. They try to use all their mental ability to try and explain away something as infinite as the human heart. In layman's terms what I'm trying to get across is there are people who live now and believe now, then you get those who make excuses for now and are also dead now, even though they live now.

Once again crypto-investor bringing Light into darkness, I just want to tell you that you opened my eyes in the last post specially. I was seriously considering an investment in Bitconnect, big for me, and as a believer of Jesus I felt conviction, and as you said I chose to repent for myself. This type of business structure is very profitable at first, just like many temptations, but then it becomes painful and brings tears to people... once again my sincere Thank You

Maybe we can make a Sin Coin that can absolve you of your sins, a blockchain for cleaning Karma or Sin from your Soul, Gods Blockchain on LambSkin to record who gets into heaven!

I think there are many ways to invests, cryptocoins which are a little "ponzi-like" - they would face immediate defeat if there are no further investors. But Bitconnect is pure absurd! The numbers make it so obvious but some people are soo gready they can't see properly as soon as they realize other people make easy back. I'm staying out of it! I think 2-3 more months and it's gonna collapse.

That's what you get for thinking. It will not fail until BTC becomes stable. They have made way to much money off the surge in BTC price currently. It has many months to go before the impending implosion.

Excellent analysis as per usual @crypto-investor I definitely agree with your views about capital limitations. As the level of capital rises, it gets much harder to produce higher level of returns. From reading a interview with Warren Buffet a few years ago, I remember him saying that it's quite possible to earn 50% a year if you're a smaller investor. However, it's nearly impossible to do that with Bershire Hathaway's current size. Likewise, it should be more difficult for larger companies, mutual funds, trading bots, etc. to earn higher returns as they grow in size.

Niiice. We need more people talking about it. tip!

lol. I'm still on the fence. I can't rap my head around 1500% growth but that's on par with the other cryptos. Guess I'll wait and see now that bitcoin has shot up unless I throw in more $ my crypto is spread out everywhere I want it. Except maybe bit connect lol.

Small cryptos have no problem growing 55k %. That growth stalls when a certain market cap is reached. Bitcoin from 2015 to 2017 grew from $200 to $3000. This is only 15x growth. It gets harder to go up the bigger you get, basically. Many smaller cryptos beat that 15x growth all the time, bitcoin's hands are tied though because it is larger. So with bitconnect it is unreasonable to conclude it will surpass the US housing market in market capitalization.

i had never believed it could continue and it is could to read your analysis - the people doing the referring are usually unknowing of the real issues and i could tell they are low intellect, so it never tempted me to invest. thanks for shedding light on the whole house of cards. -David

$10 to $49 quintillion dollars :o I knew it was ponzi scheme from the start.

Great analysis man! Definitely following you. We need more analyst like you!

good post

Sheesh and I thought I wrote elaborate posts!

Cool stuff! I'm glad you took the time to explain it in such detail. There is so much going on these days, this is perfect + anyone can check your reputation and who upvoted it. Well done.

what a great post!

Today I got new things about bitconnect!! Really thanks for sharing with us @crypto-investor!!

As in investor of bitconnect I thank you for spending the time to put these posts together. I agree that long term stability with these numbers is not possible. You are obviously extremely knowledgeable on the subject and you seem to be fair minded so I'd like to offer you a small challenge which I think you'll easily be able to complete with your intelligence level.
If your life depended on it and you had to change the characteristics of the company in order to maintain stability, what would you do? What would need to change to keep it afloat and possible? I've seen legitimate companies come out with affiliate programs and ponzi like characteristics and then adjust the company structure to make it work once they've reached their accounts created goal. How would you do it if it were you were running the show?

I think it will blow or they'll dramatically change the payout structure. One of the two has got to happen.

I don't think it's possible. I have thought about whether they could stop the trading bot from paying the 1% daily, but if they did this, demand for the token would drop, and everybody would sell their BCC tokens when their lock-out period ended, driving down token prices for BCC. At a certain level of BCC token value dropping, they would no longer have enough BCC token to repay the lending wallet redemptions.

I imagine the bot may start paying less when they start penny pinching, but at that point what are they protecting because people will stop investing. Might as well just run with the money at that point.

Cool insight. Thanks man 👊🏼 Shared your post to some people I chat with about BCC and I'll continue to do so. I like providing information positive or negative.

what they can do other lending programs are doing this is cap the amount in the daily interest wallet lets say 80k, that would break the compound and the lender would have to start from a low number say 20k to let it build back up to 80k again.

Great point. For sustainability's sake, something will have to change as the demand grows.

maths and i are not good friend :(
is bit connect good ??

yes bitconnect is good, you can try it for yourself, youll make money and there is no way they could EVER "Steal your money" without taking away all the value of their bitconnect coin! It is a decentralized cryptocurrency in the top 20 list of coinmarketcap, how can it be a 'scam" when its simply paying people the profit taken from the increasing price of bitconnect coin....?? u see? Investors would have made more money simply buying and holding bitconnect coin itself! Instead they invest in bitcoins Loan program, they triple their money in a year, when they would have made twice as much jut buying the coin itself, much like how someone could pay someone daily percentage to give them money to just buy bitcoin, u could have tripled someones money if they gave u money when BTC was $1000 a few montsh ago, now its almost $4000 so u could double someones money by now, theyd be happy, and youd get to keep HALF and they wouldnt even know, u see how it works now????

Its just taking advantage in the rising prices of crypto currency!

dont u all get it?!?!?! Cant you see that if it ASa ponzi it wouldnt have lasted this long???? IUtrs STILl working its STILL paying iout, theyy even credited everyone Bitcoin Cash, u think they are scamers that care that much to issue thir bitcoin cash even before poloniex or big exchanges do??!?!

come on guys dobt just assume sokmething is a scam because thyre making a lot of money! Bitconnect coin is simply performing!

I dont get it, just because they offer a small dailypercebt, u assume its a scam? U realize the price of bitconnetc coin has gone from like $1 to $100 almost, so that alows them to aford to EASILY double or triple the money of their investors, and STILL have profit left over

are u all starting to see how it works now???? can u please stop caling something a scam JUSt bcause you dont understand t ?!
I KNOW its strange and sketchy and i TOO called it a scam for a while! VBut its NOt and JUST because we havent ever had anything like this before that was actualy klegit doesnt man this has to be a fake scam!

just tell me HOW they are going to take off with everyons money

HMM??? Tel me, HOW will rtheyt SELL al the bitconnect coin they sell...HMM??? How will they get rid fo all that bitconnect once the price drops to 0 after they STEAL it all?????? its a decentralieed crypto currency al tracable on their blockchain,

Its ok u will see
bitconnect will be around for years and I guess youll Still just be calling it a ponzi the same way bitter people still call bitcoin a ponzi simply because they never bought any and ae angry at all these people "unfairly" making allll this money "without earning uit" and they bring up all these lame arguments and uts just so annoying
Just be happy for bitconnect and the users who have all made moneyt with it

Why arent you focusing on the REAL scams out there? nobne has gotten money stoloen frm bitcnnect, EVERYONE has gotten paid, why would u assume its a scam when its been working just fine since day 1???? Who would ibvest THIS much work into a scam with THIS much money?!?!?! u think they will be ven CAPABLE of running away with that much money?!?!?! Its impossible to take all that bitconnect without destroying the bitconnect price! And there is no way a group of people could scam THAt many people with THAT much money, Interpol and local police in England would be on thir ass SO fast, in fact, THEY ARE ALREADY being watched by law enforcement and the poolice OBVIOUSLY didnt find any suspiciou activituies or we would hear about them getting shut down like OneCoin!
Sorry for the spelling and granma erors! And sory if this offends anyone i am just passionate about succesful bloclchains and i feel the hate against bitconnect is 100 pure jelousy and envy from people who didnt invest much money into bitconnect and who are mad they arent making as much as @craig-grant heh seriously if you would have listened to Craig Grant these last 4 or 5 months you could have had $100,000 dollars by now even from just $0 if you saved up a few grand on steemit and invested in all the programs he did!


hahahahaha. Fantastic man! Bitconnect is going to give crypto a bad name. Another roadblock. Unfortunately, this may call for some regulation. Maybe not. I wonder if there is a decentralized way to regulate these ponzi's. Or maybe all we need is a Mt. Gox and a Bit-connect for people to do their research. I've got about 3 more weeks to get my capital back. I have about 70% so at least I won't get destroyed. The idea of bit-connect might work if they didn't promise a ridiculous 1%.

Certainly sounds like a Ponzi scheme, now that it takes so much computing power to create one bitcoin there's no way they could mine for it. It also peers that they couldn't charge enough commissions on transactions to make that happen either. Maybe they're causing the increase in between prices by trying to buy bitcoin to cover their next pay out before the whole thing crashes.

Steemit grows as users post articles, yes, soon people will be lucky if the get $5 for a great article.

Youre mistaken, why would users be lucky to only get $5? U think steem becomes scarce as users jpin? No thats not how it works, as users join the price of steem goes up because people save their steem and end up buying more, its not like when we double our users theyll be fighting over a maler and smaller rewards pool, no man

u think peopel were all getting paid thousands opf dollars for their posts in tghe opast or somethiong??!?!

the onloy reason YOU probobly experience low payouts, is because you may not have many followers! (u dont even hve a prpfile pic and thathurts you u shoudl add a profile pic, it shows u care about uir profile)

Anyway i thinku should rethink ur viw of steemit! maybe use it a lil moe and learn how to get followers by posting god content which u cant just do overnight u have to learn how to be intertesting and or find whats succesful on reddit or instagram to get ideas for posting on steemit

And also I dont knwow hat u think ui mean by "Steemit grows as users post articles" are u under the impression that posting artciles is equivalent to "Mining" like with bitcoin. because oiur DPOS delegates proof of serrvice system is actualy very different

ALSO to @briandenver what do u think u meant by "now that it takes so much computing power to create one bitcoin theres no way they could mine for it" but you were just talking about Bitconnect coin NOT bitcoin,a d bitconnect coin can still be mind, much easier than bitcoin, but so what do u man then? You mean u thought they coudl be usingtheir profit to mine BTC???

man cant u see that they could also be mining bitconnect coin??? OR they can just INVST in thir own Bitconnct coin WHICH SI WHAT thy do! they reinvest money into thir own cpin lik companies liek aple or facebook reinvst company profits into the company Stock making their own stock price go up, "Buying Back Shares" And bitconnetc is doing the same thing....Its just a crypto currency and its price IS gioingup which is more or less explains HOW they are getting thir money! Peopel would hav made even more money just investing in the bitconnect coin rather than actually doing the bitconnect loans and getting $10 per month for 299 days, from a $100 investment which they also gfet back at end of 299 days, so u basically triple ur money, but the price oif bitconnect has gone iup from $1 to $100 this year, so u see where the money is coming from? the daily percetage is just a way to garunte oprifut and the risk is that biotconnetc coin doesnt contineu going up, but it is m and peopel are getting oaid, they cant just counterfeit bitcoin to make payouts....abd the bitconnect cin they purchase has to show up in the blokchain, which anyone can would just be too much work to be a ponzi scheme because there would be no way to run away with the money AT ALL without causing bitconnect coin to looe all of iuts value, making it pointless to even try to steal themoney!

But i could be wrong! I acept that it COULD be a scam and it could STOP but they wont STEAL any money, they will simply stop the loans , maybe hange the rules, but on is going to loose their money like Mt Gox....has anyoen even gotten thir money back from mt gox? See Mt Gox is where people got ripped off, big exchanges is where people get riped off....i doubt bitconnect will ripp people off because of all the attention on them and all the opeople tracking them down to make sure they cant run off with any stolen coins.

Hey I hope I am not wrong but i could be wrong! I doubt that bitconnect is sojething to worry is only doing a great job or actually promoting bitcoin to more and more offering a turn key program to make money with.

sorry for my harsh commet im just very caffeinated today!

You can lead the horses to water but can't force them to drink. Then they die of thirst. You are right on every point! Love Bitconnect and making $$$ on all fronts. Thanks!

Good to read the math on this, and thanks for more effort exposing bitconnect. Fourth and fifth paragraphs could use some simplification.

Here's my sarcastic take on it:

what a BS this article is

I hate too break it to you (Crypto Investor), but most of the people in BitConnect know its a ponzi scheme. No one has forced or tricked us into putting money in the system.

Instead of writing a wall of text with cute numbers, here's how to sum up Bitconnect

  • Earning 1% per day on invested capital with NO RISK = SCAM

Simple right

With that knowledge, I still gambled, (FYI - Bitconnect is not real Investing)

Because if your worried about losing $100 usd with a Bitconnect loan , you have bigger problems

So BitConnect will be bigger then the economy of a small country in 2 years?
Thanks @crypto-investor

Why not? It already IS bigger than some small nations economies! bitcoins 50 Billion + Market cap is ALREADy biggr than many small nations economies/GDP

So why not? Bitconnect IS a decentralized crypto currency! and again i ask WHY NOT? Its just another altcoin, and therefor has the same potential as Bitcoin to grow into the tens of billins of dollar marketcap!

Its just a crypto currency and can be used like money the same ay as bitcoin! I mean look at biutcoin cash, outof nowehere 5 bilion dollars is pumped in from Fiat and maybe other crypto and so why would you doubt that bitconnect coin wouldnt be able to reach the hundreds of billions even TRILLIONS of dollars in investmet?

maybe bitconnect will surpass bitcoin! Why not?

Seriouslty they are both cryopto currency, and instead of litecoin why not bitconnect coin? Seriiously al that maters is marketcap with these big crypto currencies that people justy use a currency and not for other use cases.....So why is bitconnect any different than al the other cryptos with their insane price increases?!?!

I think we should all realize that bitconnect's growth is simpoly driven by the orice iof bitconnects growth! And bitconnect coin could read $1000 with a multi billion dllar marketcap just like bitcoi! WHY NOT??? seriously thinsg can change fdast in crypto sphere! Anyone has a chance to become #1 crypto! WHoever has the most users and people investing ends up winning!

Right again! I bought BCC coin at around $200 and asked myself, if Bitcoin can rise, then WHY NOT BCC. It's currently over $300 plus the staking rewards added to that has made for an excellent investment in return. My next question is, WHY NOT $1000 like you said. I think it will hit this number sometime in 2018. Good luck!

nice try...

When Greed Meets Incompetence. "The Challenge"!

Absolutely agree with you. And people are greedy as hell by seeing their returns and the promises of 1% returns every day and are still investing in that ponzi scheme. Ponzi schemes should be banned worldwide. I just dont know why these kind of models even exist!!

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Just a little maybe, but it's a bot so they usually don't get upvotes.

This post was well written, but this YouTube video is a Slam Dunk response

How do you explain the extreme crash of BCC in the last 48 hours then, idiot. From nearly $400 to under $20 practically overnight.

He (OP) was right. BCC came crashing down today. A LOT of people's eyes were FINALLY OPENED today. The drug dealer looking dudes (Craig Grant and Treyvon (last name hidden/huge red flag) were behind pimping (yes, hustling) bitconnect left and right via youtube along with some teenage white boy that clearly did NOT have the $800k in his acct. he kept pretending to have. BCC Bitconnect was a scam and they are still pulling people in. This is entirely because the crash of Bitcoin HID the crash of BCC. Bitcoin crash was just what happens every mid-Jan. BCC crash was long coming. I am sad that people don't realize why bcc crashed today and instead blame it on BTC's coincidental failing. Sell BCC, get out. Come back home to BTC.

BitConnect Official White Paper.


a couple of things to point out, with your math I see the problem right away, its not a lump sum figure when you reinvest its not one big loan just the base loan and reinvest loans after that, when you are compounding each reinvest starts a new loan. and the length of the loan depends on the amount of the reinvest which is dictated by the amount of months. which can be 4 months, 6 months 8 months or 10 when your base loan matures u will have other loans coming due depending on the amount of the reinvest. I hope I did not confuse you.

I concur with you 100%

It is all about liquidity. If people are willing to buy your bcc at the end of the day, you can get out of it, if not you will just be stuck with a bunch of very expensive bcc tokens. How is this different from any other thing.

If people are not willing to buy the coffee you have just produced you are stuck with it and you are willing to sell it for less. If people will be willing to sell it for less than so be it.

If you think the numbers are not possible so there are two options here, either people will accept less money for their bcc or there will be an extreme devaluation of the USD (Germany 1923). Hyperinflation of the USD anyone???
Feel free to check this video

and this post I wrote about how this could all work. I'm not offering my referral in neither. I'm not defending the system either. I'm just trying to show that at the end of the day what you call unsustainable is actually quite possible when you look at the bigger picture. The continue growth of cities and the exploitation of natural resources is unsustainable, these are finite systems, but the ever printing of the dollar... well we have been doing that for quite a while now. And that won't stop now.

This was some very good information to read. Thanks for such good information.

Thanks for the post....Isn't it that our whole economy currently works like this except that this type of return only goes to some privileged people at the top?

this is a good info
im one of bitconnect user
thanks for your investigation should be on my watchlist too

Great article. Thanks. Here are our 2 cents about Bitconnect and the Characteristics of a Cryptocurrency SCAM.

Also should have just held on to my BCC. I do BCC but don't promote it! Very very well written article! You're a legend 🙌🏼

Hey, how's it going? I recently made a post talking about bitconnect before someone mentioned it being a ponzi scheme on that post. To that end, I searched out some posts about it and came across this one. Very solid analysis.

However, I do have a question. I had no illusions that they actually exchanged BCC for dollars in the lending wallet, nor do I have any illusions that a 1% daily return is going to be the norm indefinitely. It's been my understanding that the return is tied to market volatility, and thus it will change as the market does. Your point about the bot never having "a bad day" is well taken, but if the % interest diminishes as it reaches its market cap boundary, would that still be a ponzi scheme?

The interest rate is never the same day to day, but it averages around 0.9% That being said, I was dismissive and extremely skeptical of Bitconnect after reading multiple blogs such as this one and watching all the FUD videos and the word Ponzi attached to it everywhere. However, after doing my homework I came to realize that extensive mathematics are at play here, so perfectly thought out, just like Bitcoin to where its actually become a sustainable product. This product, seems to have a sustainable profit so long as there is demand for said product. This is what is going on at present with the Bitconnect platform. Call it what you want, but at this very moment it is the Blackberry of its day before it gets replaced by the iPhone of Bitconnect to use the analogy.

Blackberry had its run and this will too, all products do and they are reborn into something else. That being said, I bought into this product, got my initial investment back and I am currently making thousands of dollars per month. Call it what you want, but at the end of the day, the numbers speak to me with results in my wallet. In fact, I challenge anyone to report a single incident where Bitconnect has not paid out what it has promised to its investors, big or small, they all get rewarded. If tomorrow the iPhone of Bitconnect suddenly appears and overtakes the current version of Bitconnect, then so be it.

My 2 BCC tokens worth of salt.

yep it's a ponzi. got my capital released 2x and now invested the profit. i want them to scam me more! :)

I agree. Ultimately, if I'm paid according to the terms that were laid out, I don't see the issue. I can look down the road and see where there may well be an issue and returns on investment will approach or reach 0%, but 1) makes it clear that the interest rate is variable, and 2) you are voluntarily assuming the risk that you may not accrue any interest on your deposit. Now, if they start withholding deposits when people attempt to take them out of the system, then there will be a problem.

You dont give a F that other people are getting hurt/robbed? Shame on you.

Where'd I say that?

Thanks for the math and breakdown

Fuck, Fuck, Fuck i just put 1000 in yesterday. I guess i can kiss that goodbye.

You will be Okay, just pull out 1000 in profit and play with the rest once you have your initial seed money back.

Although I generally disagree that Bitconnect is a Ponzi, I do like how you presented your argument here. There is one thing I wanted to point out and that is the minimum to reinvest is $10, not $100.

Hi all,

I just got into Bitconnect a few weeks ago. I was skeptical. I still am. But I'm making real money that I'm using to buy real things with. So as long as they keep paying, I'll keep using it. If you want to get in on this too, first I would suggest you educate yourself on the risks and rewards. If you still want to get in and make more than 1% a day, please use my referral link below to join my team. The daily loan interest is a good chunk of the money you make. The team building through referrals is a bigger part. Do me a solid and join my team!

I wish I could mark up your paper, because there is certainly a lot to mark up. However, I will say that I am glad that you wrote it because the last thing I want is for tons of people to pour new money in BitConnect. Your opening point was a good one, until you factor in the fact that there is no exit strategy in the scenario that you describe. Once investors realize that they can't extract more than $10,000 per week, then it makes no sense to build up millions of dollars in balance. The fact is that $120k is about the maximum balance per investor before it becomes a exercise in the absurd. Look at the online comments of current investors... all of them are pulling their payouts once their balances reach a reasonable level. Many quit their jobs and begin living off their payouts after balances of just 25k. However, you point is a good one, that eventually the capital pool could become so big that the rate of return is reduced or at least it is harder to generate a decent rate of return. At which time, capital will leave the pool.

There are a couple of issues I have with your logic. You argue that there is no trading-bot because appreciation in the value of the BCC coin itself provides enough revenue to sustain the model. In order for your theory to be plausible, BitConnect would have had to know in advance that its currency would take off 55,000%. You are making your comments in hindsight, but BitConnect couldn't have known this in advance. What you have done so well is explain why the BCC model strengthens the value proposition for investors.

Also, your statement that there is no trading-bot destroys your own credibility, because you have no way of knowing that. There are dozens of trading-bots available for anyone to use, so why wouldn't BitConnect be using one? You also don't know how much capital BitConnect is trading on a daily basis so your entire argument is purely speculative. In addition, opportunities in arbitrage are far greater than anything you can imagine right now.

It is more likely that there is a trading bot and that the trading bot is generating some revenue to make payouts. I am the first to say that I wish I knew more about how much revenue is coming from the trading-bot, the exchange, and derivatives from the BCC held in reserve.

Like I said... I am glad that people are not rushing into BitConnect because that keeps the capital pool nice and small. If someone is interested in learning more then I would be more than happy to talk off-line.

and finally....Boooom!! great article here! thanks for the explanation 👏👏

Nice article. I was about to start a similair discussion. No matter how populair a coin is. People should always do a proper background check. It surprises me how many coins are out there that don't have their basics right. Does anyone know about: Since I use this site I make so much less basic investment mistakes. Go to: For the BitConnect Detailed analysis.

Very good review! please come to my page to read how to get your bitconnect money back!

funny to read now....

Good article. Really appreciate you bring this to our attention. The decision to buy a coin should be based on real analysis of the coin. I found that people keep buying coins without have any knowledge of them. This is considered high risk. I found this great website: Since I use this site I make so much less basic investment mistakes. See: For a complete BitConnect Detailed report.

Voted and resteemed! Correction. It's 6 months old now so can't resteem anymore. Would have!

I put some money into Bitconnect knowing it would be the one of the first to fail. I lost money but what I learned was more valuable then what I lost.

I want to know what what next BitConnect and plan to avoid it.

I also lost with BitSolid.

I came upon BCC in the last week, and saw what they are doing, even signed up. But looking at this post, and doing some simple math like you did, it really doesn't seem worth it to drop money into it especially with the amount I was going to use. For the big hitters in this program, it would make sense, but small investors no way. Upvoted and followed!

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