Attracted by the many “plus points” of the bitconnect coin, people have found themselves drawn to investing in the decentralized cryptocurrency. It was considered to be the new amazing investment, until recently it all reduced down to mere sham. Yes, the cryptocurrency’s advantages have been found a delusion. After doing the math, it is evident that the interest rate given to the investors is shockingly very less and inefficient. Even though the realisation came a little slow, many people have now refrained themselves by taking such risks again.
BitConnect Coin
The BitConnect Coin is a decentralised cryptocurrency much like BitCoin, Ripple Coin, etc. It is community driven and is an open source, which enables the society or the common man to invest in a free-of-centralized banking atmosphere. In other simpler words, it is for those who wish to detangle themselves from the centralized banking. It provides a non-governmental approach to the people to store or invest their earnings. And a considerable interest rate is also provided for every investment.
Difference between Centralized and Decentralized Market
A centralised market is one which is fully in control of the central government. The currency used is referred to as the centralised currency. A centralised market does not have any other competing market. The value of the currency is represented in the exchange and that value is available without hindrance to the investors, without any alterations in the price.
For instance, the paper in your pocket is centrally controlled. That is, that paper(currency) is printed as per the government’s wish. And the value of that currency is not subjected to any change in the future, provided the government is still intact. If the Centre suddenly decides to disappear in the future, the value of the paper in your pocket will plummet down to zero. But of course, such disappearances are definitely not going to happen any time soon.
A decentralised market on the other hand is not controlled by the government in any way. It is run independently and the currency has many terms, such as BitCoin, Ripple coin, etc. Decentralisation is a way of taking the power away from the large institutions such as the Centre or government and hence redistributing the power to the common people as investors.
HOW BITCONNECT WORKS
Investors can invest their money as BitCoin or as USD in the company. If there are substantial profits, then the investors are provided with “daily profit” which is mutually shared between the company and of course the investor.
There are basically four major investment levels:
- Investment between the range $100 - $1000 and a 40% monthly profit which is paid out for 299 days
- Investment between the range $1010 and $5000 and a 40% monthly profit with 23.9% bonus which is paid out for 239 days.
- Investment between the range $5010 and $10,000 with a bonus of 35.9% which is paid out for 179 days.
- Investment between the range $10,010 and $100,000 with a bonus of 30% which is paid out for 120 days.
BITCONNECT SCAM OR NOT?
Since the whole system heavily depends on the investments and the money of a lot of people, it is not surprising when people find something smelling fishy. As it involves a lot of risks, people will definitely tend to not completely trust the whole system. Hence evaluation of such tasks beforehand is very important if you do not want to regret your decisions in the long run.
So is BitConnect a scam after all?
One reason why there is suspicion arising in many is the fact that the website does not provide any information about the company, such as who founded the company, who owns it and the like.
Many people have termed the system a Ponzi scheme. A Ponzi scheme is an investment scam in which some early investors are paid off with the money put up by later ones in order to encourage more and bigger risks.
To understand clearly, we shall divide the topic into sections.
First of all, the website does not disclose any ownership details.
Secondly, BitConnect does not extend any products or services.
And it claims that it ensures giving out the profits daily to the investors. This is fully dependent on the compensation plan you choose. The bigger the investment, larger the profits.
BitConnect insists that the investors invest anywhere between $100 to $100,000.
Conclusion
Considering all these facts and keeping them in mind, is it wise to call BitConnect a Ponzi scheme?
Let’s go through the facts again.
We have no idea about the ownership or who actually is responsible of running the company. And they require you to invest in BitCoin to invest in BitConnect coin which may be subjected to become obsolete outside of the website. And they promise profits whose source they show no proof of.
The conclusion is, once people stop investing in Bitconnect, the profits will cease and your whole investment may plummet down.
Therefore, always do your research well and choose wisely before making big decisions such as investments to be fool proof in the future.