I'm sure there are a plethora of posts about this around already, but I've been particularly glued to this whole thing as it unfolds - not sure why. I didn't invest personally, but I can't help but feel for those who lost big investments. Being duped by a scam and then being told "you shoulda known, how did you not see it?" or "if you fell for it then you deserve it" is a form of victim blaming and I don't get how people can really pull the whole "told ya so" attitude with people who made a shitty mistake and just lost their life savings in some cases. Now they're left trying to figure out what to do.
After receiving 2 cease & desist orders (one from S. Carolina, one from Texas), Bitconnect shut down their lending & exchange platform, then "reimbursed" everyone in the form of Bitconnect Coins, which very quickly plummeted from $320+ to now sitting at $15 as people dumped the shitty worthless coin. So people who invested shit tons of money in Bitcoin (which you had to send them for them to lock up for months and months while they trickled its "earnings" it made daily to you) got it all back in a worthless coin while the scammers took off with all their real investments.
I quickly checked out the /r/bitconnect subreddit, but it didn't take long for the mods to privatize it. To my understanding, the new subreddit mods were put in place there yesterday, just before the news hit. So they basically got handed a bomb with the fuse lit and told, "Good luck!" There's another subreddit called /r/bitconnectcoin which is still active. There are people on there with their stories, talking about having invested their life savings (which no one should ever do) and legal actions and so forth and so on. Trevon James and Craig Grant were bigtime promoters of the platform, and almost everyone is calling for their indictment for promoting, participating in, and profiting from a Ponzi scheme, a Class A Felony.
There was sentiment that all alt coins would inevitably follow Bitconnect, which to me seemed like a testament to the general state of crypto knowledge among the public. If people truly don't understand the difference between an operation like Bitconnect compared to legit coins then when another one of these scams pops up they'll be just as successful as these guys were.
What other crypto requires you to hand over your coins and lock them up for up to a year? Other cryptos aren't using funds from new people to pay the established early adopters. Don't get me wrong, there are some trash coins, but I don't even believe Bitconnect was a very real coin to begin with. The only place you could really even get it was on their own site in their own internal exchange. There are a couple of exchanges where you could get them, so it was real enough to get listed, but their "lending service" was where the ponzi really shined. The coin was just a front; a necessary part of the scam to pull in newbs drooling over the modern-age gold rush.
Admittedly, this thing actually almost had me some time ago until I got to the points where they said:
- You were basically guaranteed a return every day - which is impossible.
- I couldn't get my initial base investment back until after so many months (the more you invested, the quicker you got it back).
Those were the big red flags for me. If I don't have complete autonomy over my own funds to move it anywhere I want at any time I want, then I don't have control of it at all. And although they shut down after being given 2 cease & desist orders, it was interesting how they shut down during a major dip in the market. That's when ponzis get exposed. When enough people panic and sell out, the ponzi runs out of fuel and the perps can no longer pay anyone. All the legal crap going on right now with them just seems like amazing timing. The perfect excuse. "Oh, we're not closing because we're a scam that can't support itself anymore. We got screwed by the government and they're making it legally to hard to keep going!"
Oh, bullshit.
I'm glad I didn't fall for it. I hope none of you did. If so, I'm sorry for whatever losses you experienced.
