Cryptocurrency

Bitconnect shuts down, deceives its customers and stops controversial lending of BCC token

One of the most controversial coin and often referred to as Bitconnect ponzi scheme lending platform finally shuts down as of Jan 16th. Bitconnect lending platform was trading around 300$ before the announcement. Bitconnect dumped the bitcoin amount to bitconnect tokens which are worthless at the moment plummeted 80%, currently selling at less than 30$. None of the reputed exchanges trade bitconnect hence there is no means the customers can get their money back which makes it a perfect ponzi coin at the moment.

The company released a statement saying they are closing down the exchange because of bad reputation.

HOW BITCONNECT DECEIVED ITS CUSTOMERS :

Bitconnect platform had a market-cap up-to 2.5 billion and per token price reached upto 400$ . This platform requested customers to invest using bitcoin equivalent to their platform.

Customers would transfer bitcoins to bitconnect platform, then convert them to bitconnect token and put them for lending. Bitconnect claimed to have the trading bots which provides more than 1% interest per day.

The tricky part here is that bitconnect is traded by their own exchange and no major exchanges trade them. Hence their control their own supply and rates. The company kept the valuable bitcoins and converted valuable bitcoins to bitconnect tokens. The company founders basically conned investors by issuing ponzi coins in this case. Once the company decided to shut down bitconnect platform, they dumped the bitconnect tokens to customers which is basically has no value nor can be traded.

When bitconnect started, they provided referral bonus upto 7 levels running similar to a multilevel marketing platforms. This appealed to lot of customers who ended up investing and invited their friends and family to do the same.

Below is the chart of Bitconnect interest platform :

Bitconnect  announced that their ICO for BitconnectX trading platform will still happen  and that trading for the BCC token will continue there. However there is no announcement and customers felt betrayed when their investment has been worthless at this point.

The Texas Securities Board and North Carolina Secretary of State Securities Division issued a warning that bitconnect cannot operate unless its registered to sell securities.

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Author : Aaron

Crypto Enthusiast ! Leader in Blockchain. Senior editor since Nov 2017 and enjoy freelancing at Cryptonewsbytes.

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