Dear All,
https://bitconnect.co/system-news/72/bitconnect-accessibility-update-glitch-in-the-websites-service/
As of Now, price of Bitconnect plunged and recovered back at bit . I was curious and went to find out more. From the website, Bitconnect is not accessible.
On the 25th August, this was written and posted:
"Bitconnect Accessibility Update - Glitch in the website’s service
The bitconnect dashboard and exchange platform will remain inaccessible due to a glitch in the website’s service. We shall be aiming to reactivate accounts by 3:00PM (GMT), 27 August 2017. The issue has been that many members have withdrawn more BTC and BCC than they held in their wallet. This issue is currently under investigation and we will be suspending accounts who benefitted from this glitch temporarily.
We will display a negative balance in the wallets of users who have withdrawn more funds than indicated by their balance. We request those members to refund all funds of BTC/ BCC back into their wallets to protect the value of the community."
As my sharing previously, whenever there is high return, there is always risk associated with it.
High Risk High Return is the mantra.
For this case studies, where are risks?
There are many risks involved in cryptocurrecies:
- Market Risk - volatility of price of coin
- Fraud Risk,
- IT risk
- Counterparty Risk-- exchnager
- Legal and Compliance Risk
- Operational Risk
Today I will be talking about Operational Risk which i think is the biggest risk for cryptocurrecy a aprt from Market Risk.
What is Operational Risk?
Operational Risk
Operational Risk is the risk of a change in value caused by the fact that actual losses, incurred for inadequate or failed internal processes, people and systems, or from external events (including legal risk).
As for Bitconnect as well as all other crypto currencies - BitCoin , Ethereum, failed internal processes and system will affect the value of the coins.
BitCoin...capacity issues, SegWit or Segwit2x
Bitconnect: Withdrawal programs error causing multiple withdrawal done
Ethereum...Hacked!!
Even though they can set to negative account balance, do you think people will return the money? Majority of people will take the money and set up new account.
If the loss is too big, do you think the Bitconnect will pay for the loss with Bitcoin?
Bitconnect is holding Bitcoins valued billions usd from the Bitcoin Wallet.
From my analysis, the biggest impact would be the number of BCC does not reconcile as many have over withdrawn the number of BCC. Recovery of BCC coins are very unlikely but there will be some honest guys who will pay back. Those are very few as they have not been scammed before in the previous ventures.
Under Operational Risk, you can lose everything. The website can close down forever and it has happened to many HYIP websites and will eventually happen in cryptocurrency space.
Let 's see what happen in the future.
Every day, I have seen many more new ICO being offered and created easily and I would expect to see many ICO are failing on the hour to hour basis.
Therefore always look at the operational risk when investing in new cryptocurrency.
Thats all for today.
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