RE: BitConnect Scam??? Day 38 Results
Its been FIVE MONTHS and ALL is WELL on the BITCONNECT FRONT! ....WHY? HOW?
They built in NEGATIVE FEEDBACK LOOPS that control the NUMBER of NEW "investors". That mechanism is the DAILY INTEREST. --> That is controlled by the amount of LOAN money thats in the loan pool. The greater the SUPPLY of money thats in LOAN POOL, the less they will USE on a day to day basis, resulting in NET LOWER RETURNS for ALL investors. This NEGATIVE FEEDBACK LOOP has barely started. We are still getting good returns on average but not quite as good as six months ago. This will become evident and new folks will begin to taper off (Hopefully). Because, the more money in the pool, the less Bitconnect needs MY money. If they only borrow 50% of the available funds, but their trading is just as profitable, my daily interest is cut by 50%.
NEGATIVE FEEDBACK LOOP protection #2
The Lending wallet is protected with the fixed "VALUE" of the US Dollar. Notice that Bitconnect pays investors in this value. WHile the Price of BCC may move irradically, the investors VALUE remains the same. When its time to CASH OUT, you trade your Lending wallet "Value" for BCC at the going US dollar/BCC rate. This hedges your loss by covering you if BCC tanks. However, the cost is you will not grow with BCC. Insurance ALWAYS has a price.
NEGATIVE FEEDBACK LOOP protection #3
The Fact that at cash out time an artificial DEMAND for BCC is created when you purchase the BCC. This demand acts to stabilize the currency.
NEGATIVE FEEDBACK LOOP protection #4
The staggered release of funds causes a regulated flow of DEMAND for BCC, again acting as a stabilizer.
As Long as the market isn't disrupted by the government or the BAD MARKETING practices, everything should work great. They will slowly begin reducing returns, and phase the entire loan system out without anyone getting hurt. OF COURSE the BIGGEST ENEMY to Bitconnect is its OWN INVESTORS using the pie-in-the-sky exponential growth spreadsheet , leading to the perception that the entire system is corrupt and created by CON-MEN. BECAUSE those returns are as stupid as they LOOK!
How long will Bitconnect continue to pay good returns????-- It all depends on HOW MUCH BITCONNECT NEEDS and is willing to "BORROW". When that need subsides so will investor returns.
If I ran the system I would have a five year plan(+/-) of capital generation with a gentle tapering of interest earned, then stop all loans all together once the coin was established and growing on its own merit.
Hopefully, they are thinking along the same lines. For now, I'm in for $5010.
"irradically" what means