Lending platform closed with immediate effect
Ultra-controversial lending platform, Bitconnect announced yesterday that it will close its lending platform with immediate effect. After two recent Cease and Desist orders from the state of Texas and North Carolina, the fall in Bitcoin price over the recent weeks and general “fear, uncertainty and doubt” about Bitconnect, the nail in the coffin was several days of DDoS attacks to the site.
Bitconnect was a lending platform that launched in January 2017. Users deposited BTC, then converted to Bitconnect (BCC) coins and lent the value in return for a daily interest payment back in USD. Capital releases were scheduled back to users dependent on how much they invested – with many simply reinvesting their earnings.
For many, Bitconnect was their only experience of cryptocurrency. Many people who knew nothing about the technical backgrounds of cryptocurrencies were hooked in by videos on YouTube of people showing daily interest payouts in their thousands – most of these were from affiliate fees (as Bitconnect operated a system where affiliates made up to 7% of their referral’s investments). Before it closed, the platform had over 1.5 million members investing at any one point and although many made their money back, there are an unknown amount of people who have made a loss on their investment.
After days of DDoS (Distributed Denial of Service) attacks, the platform was suffering from endless outages and the Bitconnect (BCC) coin price started a one-way trip from $407 down to $286 in just 36hrs. It now stands at just over $20.
Last night, an announcement on the Bitconnect website informed users that the lending platform would be closed immediately, followed by the trading exchange closing in 5 days. Users with current loans will have them released as USD and automatically converted over to their BCC coins at a rate of 1 BCC = $376.02. Users are then allowed to sell the BCC for BTC on the internal Bitconnect exchange, or sell them externally on one of the other exchanges that accepts BCC.
However, it appears though that the BCC exchange is already dead, with no transactions taking place in the last 24 hours leaving users to sell their BCC at other exchanges.
In the post, they say the site will stay live as an educational and news platform and provide a wallet service for the Bitconnect (BCC) coin.
However, they also announced the BitconnectX ICO was to continue and they’ll be launching their promised exchange as promised in their road map in late May 2018. Although this leaves little hope for most users, there is a possibility they could turn this around if the new exchange ends up using BCC coins possibly, already the price has risen to low $20s from an initial low of just $8 per BCC.
It also looks like other lending platforms have not been shaken by Bitconnect’s sudden departure and if anything are turning it into a positive thing, LoopX, who’s ICO has just concluded has emailed all users with the following statement:
As one lending platform closes, another ten or twenty are about to start. All claim to have trading bots that generate the daily interest required to pay back the users each day, but most over-deliver and rely on the Bitcoin price to keep on increasing like it did throughout 2017.
UPDATE: It appears users on Twitter are reporting they can send their BCC coins direct to the BitconnectX ICO where each BCC coin is valued at $150. Users can then buy the new ICO coins for $50 each (3 per BCC coin). This is currently verified as Bitconnect have released a statement.