Most cryptocurrency enthusiasts are well aware that BitConnect is a very problematic venture. Some people even call it an outright scam, although others still seem to be making money off it without any problems. The Texas Securities Commissioner recently sent the company an emergency cease and desist order. It’s a very big step toward shutting this dubious program down once and for all.
Curtain Call for the BitConnect Scheme?
Ever since the BitConnect program came to market, people have publicly voiced their concerns over this possible Ponzi scheme. It looks and feels almost identical to OneCoin, with the exception that people can actually trade BCC across a few exchanges. Most of the trading volume originates from the company’s own exchange, though, which is always something to be concerned about. There’s a good reason why BitConnect can’t be traded across any major exchange right now.
How things will play out for BitConnect has yet to be determined at this point. The team recently received an emergency cease and desist order from the Texas Securities Commissioner. Such warnings are never sent out unless there is sufficient proof to indict a company. There have been plenty of concerns regarding BitConnect for quite some time now, and it is evident that some of these concerns may be more than valid. Now that BitConnect’s market cap is in the multi-billion dollar range, things have grown a lot more problematic.
Whether or not this emergency cease and desist order will fall on deaf ears has yet to be determined. The Texas Securities Commissioner wants to end all BitConnect-related services at once. It is evident this will not be easy, especially considering that BitConnect is an overseas company. Consequently, the US has very little jurisdiction over it, even though it is likely that US-based investors are part of this scheme as well.
Most cryptocurrency enthusiasts are absolutely convinced that BitConnect is a scam. So far, it has been pretty difficult to prove them wrong in this regard. After all, everything the company is doing seems shady at best. There is very little transparency, especially when it comes to generating profits for investors. Until this situation is clarified, there will always be concerns that BitConnect is a Ponzi scheme.
Indeed, soliciting investors for annual returns of 100% or more sounds incredibly fishy to anyone. In the world of cryptocurrency – or finance, for that matter – there is no such thing as guaranteed returns, especially not in the double or triple-digit range. Moreover, the company has issued its own currency, with the circulating and total supply changing on a regular basis. That in itself is another problem that will have to be addressed at some point in the future.
It seems more and more platforms are moving away from displaying any advertisements or content related to BitConnect. While everyone wants to make money, there’s no point in doing so if you have to purposefully mislead others. There are plenty of questions regarding this company which will need to be answered at some point in the future. For now, those answers still remain elusive.
In the end, it is good to see some regulators take a harsh stance toward potentially harmful projects like BitConnect. The Texas Securities Commissioner has made an important first step in this regard; that much is evident. Whether or not other states or even countries will follow this example remains unknown. It is best to stay away from BitConnect right now, especially until all of these issues have been properly resolved.
