Bitconnect Behind the Curtain – What Bitconnect Did That Left Cryptocoin Investors Shocked, Sad, Angry and Out for Blood.
Before we take a look at Bitconnect behind the curtain we need to look at the public positioning of Bitconnect.
Introduction – What Is (Was?) Bitconnect?
In essence, the BitConnect service claimed to convert Bitcoin (BTC) into BCC (their proprietary coin) and pay holders of BCC interest earned from their trading bot. It should be said that the actual existence of such a bot is dubious at best. It has been said that Bitconnect itself controlled the supply and the price of BCC. If Bitconnect wanted the price up or down on any given day they put the word out to their promoters and other insiders who would either pump or dump BCC as needed which would dictate the returns to be paid the next day.
The interest rates grabbed everyone’s attention and with good reason; claims run the range from 1% to as much as 4% PER DAY depending upon how much the investor loaned. The premise behind the persuasion runs along the lines of “we’re better cryptocoin investors than you so trust us with your Bitcoin and you’ll make money.”
This leads to the first litmus test: If something sounds too good to be true it probably is. Critical thinking skills should have been applied by every prospective investor prior to putting their trust in Bitconnect.
Steve Dell, writing for Medium framed this perfectly in his piece “Bitconnect Explained”:
“An speculative investor should ask is: Why? If you have this incredible ability to trade an asset in such a way that you have virtually no risk and tremendous upside, why would you allow little old me to reap the benefits of that? If you’re able to get 1% per day on $100,000, in one year you’d be looking at close to $4,000,000. Their method of trading would truly be revolutionary…
…If you could generate that kind of income passively, would you ever consider trading?”
Steve Dell’s reasoning resonates with my own when it comes to Bitcoin cloud mining; if you can make so much money on your own why invite anyone else to share in your riches?
Bitconnect Promoters – Who Are They, What Did They Do and How Much Did They Get Paid?
Some colorful names of Bitconnect promoters on this list:
Cryptogirl, Crypto Clover, Jeti Knight, crypto Nick, Trevon James, Glenn Arcaro, Craig Grant, Ryan Hildreth and Joey Rocket among others. Sunny Decree was a promoter then decided it was a scam months ago and stopped promoting. Side notes on Joey Rocket – There is a Joeyrocket LLC out of Tempe Arizona. Joey Rocket went the extra mile with his Bitconnect pitch videos having them translated to reach prospective Bitconnect investors and/or promoters in Malaysia and Germany.
All of these promoters are fascinating subjects. Perhaps Crypto Nick a little bit more interesting than the others in the sense that he’s a millionaire and has yet to celebrate his 18th birthday. This YouTube interview is eye-opening…
Bitconnect promoters were essentially on the payroll getting what is believed by some to be a fixed amount of BCC PLUS a generous weekly marketing budget of .5 Bitcoin (that’s $7,500 give-or-take) for weekly advertising which was largely, if not entirely, spent on YouTube advertising promoting their videos. Interestingly, nearly all of the videos created and published by Bitconnect promoters have been deleted right around the time Bitconnect shut down their lending operation. It seems they had an exclusive view of Bitconnect behind the curtain before anybody else.
Other sources believe they were paid a percentage of every dollar they brought in. I think the percentage-based model is the one they were paid by as it makes the most sense and perfectly explains all of the enthusiasm the promoters exhibited in talking up Bitconnect.
What is certain is that top promoters of Bitconnect behind the curtain enjoyed yacht parties, posh luxury cars made by Porsche, Aston Martin and yes Lamborghini as well as all-expenses-paid junkets to Thailand.
How did it work? The promoters have (had?) their affiliate links which tracked all of their activity which was the basis of them getting paid through bringing in new Bitconnect investors. In turn, the promoters recruited people to work under them. This points to a classic MLM (multilevel marketing) scheme. The promoter on top of the pyramid collected a percentage of all of the money the promoters under them brought in plus the cars, trips and parties and who even knows what else?
The Bitconnect Impact – How Much Did They Take? How Much Did They Make?
Since it seems Bitconnect controlled the price and the supply of BCC there’s no way to be sure of how much money was made by them and lost by investors. Estimates range from $600 million to over $2 billion as illustrated in these charts:
How many dollars are we talking about here? We may never know for sure. Certainly millions and quite possibly billions. If we’re fortunate we’re getting a closer look at Bitconnect behind the curtain one day.
The Bitconnect Shutdown – Shattered lives, broke and broken families coupled with suicidal thoughts
I documented the Bitconnect shutdown a few days ago. The official word is that Bitconnect will redeem each BCC coin held for $363 per coin. The thing is, the cryptocoin markets tanked the BCC price to the degree it plummeted in value by 90% the same day the Bitconnect shutdown news broke. Indeed, some suspect the plunge of most coins on the cryptocoin markets (Bitcoin, Ethereum, etc.) were impacted by the Bitconnect disconnect.
What I can only add is that the tales of tragedy and loss are profound and almost indescribable. A lot of people have lost money. Some are now completely destitute, others simply depressed over losing money while a few are still in denial and are hoping for a BCC price rebound. That seems increasingly unlikely as BCC was about $30 three days ago and is $18 today. Husbands are fearful of telling their wives, businessmen are facing bankruptcy and some have even admitted to contemplating suicide.
After taking a good long look at Bitconnect behind the curtain nobody should be holding out hope of getting anything near their money back except through a successful outcome of a Bitconnect class action lawsuit.
Who Owns and Runs Bitconnect?
Here’s where we try to see Bitconnect behind the curtain. In something akin to the movie “Catch Me If You Can” in the sense it’s difficult bordering on the possible to identify with certainty who is the owner/are the owners of Bitconnect. The best research we’ve seen so far was done by “The Bitcoin Informant”. His YouTube video does an excellent job of unearthing critical documents and connecting important dots. I would take the references to the Illuminati with a grain of salt but otherwise respect the excellent research he has performed….
Here’s another excellent video with impressive global research from England to Indonesia with additional reach into OneCoin while drawing parallels…
The Bitconnect saga is still unfolding. The entire Crypto Capers team is on this along with a panel of former Bitconnect customers and cryptocoin experts compiling and supplying us with all of their research. We’ll update you as news comes in.