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==Legal issues==
==Legal issues==
On January 16, 2018, Bitconnect announced it would shut down its cryptocurrency exchange and lending operation after regulators from [[Texas]] and [[North Carolina]] issued a cease and desist order against it.<ref>{{Cite news|url=https://gizmodo.com/bitconnect-anonymously-run-crypto-exchange-crashes-af-1822144652|title=BitConnect, Anonymously-Run Crypto Exchange, Crashes After States Issue Cease and Desists|last=McKay|first=Tom|date=2018-01-17|work=Gizmodo|access-date=2018-01-17|archiveurl=https://web.archive.org/web/20180117061255/https://gizmodo.com/bitconnect-anonymously-run-crypto-exchange-crashes-af-1822144652|archivedate=2018-01-17|deadurl=no|language=en-US}}</ref><ref name="bloomberg">{{Cite news|url=https://www.bloomberg.com/news/articles/2018-01-16/bitconnect-closes-exchange-as-states-warn-of-unregulated-sales|title=BitConnect Closes Exchange as States Warn of Unregulated Sales|last=Kharif|first=Olga|date=2018-01-16|work=Bloomberg|access-date=2018-01-17|archiveurl=https://web.archive.org/web/20180117001520/https://www.bloomberg.com//news/articles/2018-01-16/bitconnect-closes-exchange-as-states-warn-of-unregulated-sales|archivedate=2018-01-17|deadurl=no}}</ref><ref>{{Cite news|url=http://nymag.com/selectall/2018/01/ponzi-scheme-bitcoin-site-bitconnect-shuts-down.html|title=The Rise and Fall of BitConnect, the Sketchiest Crypto Exchange|last=Swearingen|first=Jake|date=2018-01-17|work=Select All|access-date=2018-01-17|archive-url=https://web.archive.org/web/20180117144452/http://nymag.com/selectall/2018/01/ponzi-scheme-bitcoin-site-bitconnect-shuts-down.html|archive-date=2018-01-17|dead-url=no|publisher=New York Magazine|language=en}}</ref><ref>{{Cite news|url=http://www.nasdaq.com/article/crypto-news-update-20180117-00663|title=Crypto News Update|date=2018-01-17|work=NASDAQ.com|access-date=2018-01-18|language=en-us|deadurl=no|archiveurl=https://web.archive.org/web/20180117173753/http://www.nasdaq.com/article/crypto-news-update-20180117-00663|archivedate=2018-01-17|df=}}</ref> On January 31, 2018, the U.S. District Court, Western District of Kentucky, granted a temporary restraining order freezing Bitconnect's assets and "to disclose cryptocurrency wallet and trading account addresses, as well as the identities of anyone to whom Bitconnect has sent digital currencies within the last 90 days."<ref name="US Court Freezes BitConnect Assets as Lawsuits Mount">{{cite web|url=https://www.coindesk.com/us-court-freezes-bitconnect-assets-as-lawsuits-mount/|title=US Court Freezes BitConnect Assets as Lawsuits Mount|last=De|first=Nikhilesh|date=2018-01-31|website=CoinDesk|archiveurl=https://web.archive.org/web/20180209003146/https://www.coindesk.com/us-court-freezes-bitconnect-assets-as-lawsuits-mount/|archivedate=9 February 2018|deadurl=no|accessdate=8 February 2018}}</ref>
On January 16, 2018, Bitconnect announced it would shut down its cryptocurrency exchange and lending operation after regulators from [[Texas]] and [[North Carolina]] issued a cease and desist order against it.<ref>{{Cite news|url=https://gizmodo.com/bitconnect-anonymously-run-crypto-exchange-crashes-af-1822144652|title=BitConnect, Anonymously-Run Crypto Exchange, Crashes After States Issue Cease and Desists|last=McKay|first=Tom|date=2018-01-17|work=Gizmodo|access-date=2018-01-17|archiveurl=https://web.archive.org/web/20180117061255/https://gizmodo.com/bitconnect-anonymously-run-crypto-exchange-crashes-af-1822144652|archivedate=2018-01-17|deadurl=no|language=en-US}}</ref><ref name="bloomberg">{{Cite news|url=https://www.bloomberg.com/news/articles/2018-01-16/bitconnect-closes-exchange-as-states-warn-of-unregulated-sales|title=BitConnect Closes Exchange as States Warn of Unregulated Sales|last=Kharif|first=Olga|date=2018-01-16|work=Bloomberg|access-date=2018-01-17|archiveurl=https://web.archive.org/web/20180117001520/https://www.bloomberg.com//news/articles/2018-01-16/bitconnect-closes-exchange-as-states-warn-of-unregulated-sales|archivedate=2018-01-17|deadurl=no}}</ref><ref>{{Cite news|url=http://nymag.com/selectall/2018/01/ponzi-scheme-bitcoin-site-bitconnect-shuts-down.html|title=The Rise and Fall of BitConnect, the Sketchiest Crypto Exchange|last=Swearingen|first=Jake|date=2018-01-17|work=Select All|access-date=2018-01-17|archive-url=https://web.archive.org/web/20180117144452/http://nymag.com/selectall/2018/01/ponzi-scheme-bitcoin-site-bitconnect-shuts-down.html|archive-date=2018-01-17|dead-url=no|publisher=New York Magazine|language=en}}</ref><ref>{{Cite news|url=http://www.nasdaq.com/article/crypto-news-update-20180117-00663|title=Crypto News Update|date=2018-01-17|work=NASDAQ.com|access-date=2018-01-18|language=en-us|deadurl=no|archiveurl=https://web.archive.org/web/20180117173753/http://www.nasdaq.com/article/crypto-news-update-20180117-00663|archivedate=2018-01-17|df=}}</ref> On January 31, 2018, the U.S. District Court, Western District of Kentucky, granted a temporary restraining order freezing Bitconnect's assets and "to disclose cryptocurrency wallet and trading account addresses, as well as the identities of anyone to whom Bitconnect has sent digital currencies within the last 90 days."<ref name="US Court Freezes BitConnect Assets as Lawsuits Mount">{{cite web|url=https://www.coindesk.com/us-court-freezes-bitconnect-assets-as-lawsuits-mount/|title=US Court Freezes BitConnect Assets as Lawsuits Mount|last=De|first=Nikhilesh|date=2018-01-31|website=CoinDesk|archiveurl=https://web.archive.org/web/20180209003146/https://www.coindesk.com/us-court-freezes-bitconnect-assets-as-lawsuits-mount/|archivedate=9 February 2018|deadurl=no|accessdate=8 February 2018}}</ref>
== Trivia ==
On October 28th, 2017, BitConnect held its first annual ceremony in Pattay, Thailand. During the event, an investor named Carlos Matos from New York gave an enthusiastic presentation and testimonial about the website which led him becoming an [[internet meme]].<ref>{{Cite web|url=https://www.inverse.com/article/40894-bitconnect-carlos-meme-cryptocurrency|title=‘Bitconnect Carlos’ Meme Is Everything Wrong With Cryptocurrency Hype|last=Paez|first=Danny|website=Inverse|language=en|access-date=2019-01-16}}</ref>


== See also ==
== See also ==

Revision as of 14:49, 16 January 2019

Bitconnect Coin
Bitconnect logo
Denominations
CodeBCC
Development
Initial release15 February 2016[1]
Development statusPermanently closed; reported as a scam or a Ponzi scheme
Written inC++
Operating systemWindows, OS X, Linux, Android
Source modelOpen source
LicenseMIT License
Ledger
Timestamping schemeScrypt (PoW) + Proof of Stake
Block explorerchainz.cryptoid.info
Website
Websitehttps://bitconnect.co/

Bitconnect (also spelled BitConnect and stylized bitconnect, ticker BCC), was an open-source cryptocurrency which has been described as a high-yield investment program and a Ponzi scheme.[2][3]

Bitconnect closed in January 2018. The BCC token was still in circulation, and crashed in price. As of September 2018, the token has been delisted from the last exchange that traded it, Trade Satoshi.[4]

History

Bitconnect was released in 2016 with the goal of allowing users to lend Bitcoin for interest. Though this goal was never realized, BCC acted as an alt-coin but allowed users to earn interest on their own wallet.[1]

November 7, 2017, the government of the United Kingdom issued Bitconnect a notice with two months to prove its legitimacy.[1][5]

On January 3, 2018, Texas State Securities Board issued a cease and desist to the company, calling it a Ponzi scheme, and citing failings in user earnings transparency, and misleading statements.[1] Texas State Security Board and North Carolina Secretary of State Securities Division warned that Bitconnect was not registered to sell securities in their respective states.[1]

January 17, 2018, Bitconnect shut down,[3][1] and BCC prices crashed by 92% immediately after.[6] Bitconnect announced it would refund its loans.[7] However, the Bitconnect X website remained open and operational, having just begun its ICO and allowing users to purchase BCCX coins with their BCC coins.[8]

On January 31, 2018, a temporary restraining order froze Bitconnect's assets, expiring on February 13th.[9] An alleged India region leader (one level below founder) of Bitconnect, Divyesh Darji, was arrested in Delhi, India in August 18, 2018.[4]

Criticism and collapse

Bitconnect was suspected of being a Ponzi scheme[10] because of its multilevel marketing structure and impossibly high payouts (1% daily compounded interest).[6][7][11] The Bitconnect Coin was among the world’s top 20 most successful cryptocurrency tokens[12] until its price plunged 65 percent starting on January 3, 2018. After BCC hit an all-time high of US $463 in December 2017, it declined to US $5.92 as of January 30, 2018. Bitconnect has said it will refund all outstanding loans at a rate of US $363.62 to the Bitconnect Wallet in form of BCC. However, at the time Bitconnect paid outstanding loans, the currency's market price had already declined to less than $10, making the payments largely worthless.[7][13][14]

On January 16, 2018, Bitconnect announced it would shut down its cryptocurrency exchange and lending operation after regulators from Texas and North Carolina issued a cease and desist order against it.[15][16][17][18] On January 31, 2018, the U.S. District Court, Western District of Kentucky, granted a temporary restraining order freezing Bitconnect's assets and "to disclose cryptocurrency wallet and trading account addresses, as well as the identities of anyone to whom Bitconnect has sent digital currencies within the last 90 days."[9]

Trivia

On October 28th, 2017, BitConnect held its first annual ceremony in Pattay, Thailand. During the event, an investor named Carlos Matos from New York gave an enthusiastic presentation and testimonial about the website which led him becoming an internet meme.[19]

See also

References

  1. ^ a b c d e f "What is BitConnect (BCC) and how does it work?". Finder.com. 2 January 2018. Archived from the original on 25 January 2018. Retrieved 30 January 2018. {{cite web}}: Unknown parameter |dead-url= ignored (|url-status= suggested) (help)
  2. ^ Mix (2018-01-17). "How BitConnect pulled the biggest exit scheme in cryptocurrency". The Next Web. Archived from the original on 2018-01-31. Retrieved 2018-01-30. {{cite news}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  3. ^ a b Wieczner, Jen (January 17, 2018). "Bitcoin Crashes to Below $10,000 as Cryptocurrency Scams Scare Investors". Fortune. Archived from the original on January 27, 2018. Retrieved February 10, 2018. {{cite news}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  4. ^ a b Osborne, Charlie. "Alleged head of BitConnect cryptocurrency scam arrested in Dubai - ZDNet". Retrieved 27 October 2018.
  5. ^ https://beta.companieshouse.gov.uk/company/10278342/filing-history
  6. ^ a b Williams, Sean. "BitConnect, Alleged Crypto Ponzi Scheme, Shutters Its Lending and Exchange Services and Plunges 92%". The Motley Fool. Archived from the original on 2018-01-18. Retrieved 2018-01-18. {{cite news}}: Unknown parameter |dead-url= ignored (|url-status= suggested) (help)
  7. ^ a b c Tepper, Fitz. "Bitconnect, which has been accused of running a Ponzi scheme, shuts down". TechCrunch. Archived from the original on 2018-01-18. Retrieved 2018-01-18. {{cite news}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  8. ^ Sedgwick, Kai (20 Jan 2018). "Not Content Scamming $1.5 Billion, Bitconnect Wants Another $500 Million for ICO". Bitcoin. Retrieved 9 October 2018.
  9. ^ a b De, Nikhilesh (2018-01-31). "US Court Freezes BitConnect Assets as Lawsuits Mount". CoinDesk. Archived from the original on 9 February 2018. Retrieved 8 February 2018. {{cite web}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  10. ^ Popper, Nathaniel; Bowles, Nellie (2018). "Bitcoin Falls Below $10,000 as Virtual Currency Bubble Deflates". The New York Times. ISSN 0362-4331. Archived from the original on 2018-01-18. Retrieved 2018-01-18. {{cite news}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  11. ^ Cheng, Evelyn (2018-01-17). "Digital currency plunge may be healthy for cryptocurrency market". CNBC. Archived from the original on 2018-01-18. Retrieved 2018-01-18. {{cite news}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  12. ^ Williams, Sean (2017-07-20). "The 20 Largest Cryptocurrencies by Market Cap". The Motley Fool. Retrieved 2018-06-22.
  13. ^ "Changes coming for the Bitconnect system - Halt of lending and exchange platform". BitConnect. 2018-01-16. Archived from the original on 2018-01-18. {{cite web}}: Unknown parameter |dead-url= ignored (|url-status= suggested) (help)
  14. ^ Bhargav, Sushant (2018-01-16). "Bitconnect Shut Down it's Lending Platform Officially for Good". TechScoop.in. Archived from the original on 2018-01-18. Retrieved 2018-01-18. {{cite news}}: Unknown parameter |dead-url= ignored (|url-status= suggested) (help)
  15. ^ McKay, Tom (2018-01-17). "BitConnect, Anonymously-Run Crypto Exchange, Crashes After States Issue Cease and Desists". Gizmodo. Archived from the original on 2018-01-17. Retrieved 2018-01-17. {{cite news}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  16. ^ Kharif, Olga (2018-01-16). "BitConnect Closes Exchange as States Warn of Unregulated Sales". Bloomberg. Archived from the original on 2018-01-17. Retrieved 2018-01-17. {{cite news}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  17. ^ Swearingen, Jake (2018-01-17). "The Rise and Fall of BitConnect, the Sketchiest Crypto Exchange". Select All. New York Magazine. Archived from the original on 2018-01-17. Retrieved 2018-01-17. {{cite news}}: Unknown parameter |dead-url= ignored (|url-status= suggested) (help)
  18. ^ "Crypto News Update". NASDAQ.com. 2018-01-17. Archived from the original on 2018-01-17. Retrieved 2018-01-18. {{cite news}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  19. ^ Paez, Danny. "'Bitconnect Carlos' Meme Is Everything Wrong With Cryptocurrency Hype". Inverse. Retrieved 2019-01-16.
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