With the cryptocurrency world exploding the last 6 months or so and the price of Bitcoin at an all time high (right now above $3350 USD!) there are so many sites out there trying to get your attention (and your Bitcoin!). I decided to try as many as I can and then report back to YOU so even beginners in cryptocurrency can get a good idea of how these things work & either avoid a scam or learn about the next best investment in cryptocurrency.
EDIT: Here are all my Bitconnect articles for you to follow my journey so far!
Bitconnect Challenge – Day 90 | Bitconnect Challenge – Day 60 | Bitconnect Challege – Day 28 | Bitconnect Challege – Day 18 | Bitconnect Challenge – Day 14 | Bitconnect Challenge – Day 2 | Taking On Bitconnect – Day 1
I have been curious about a lot of sites, but Bitconnect has been mentioned a lot and while many have called it a scam or a ponzi scheme I have decided to take the risk for you and find out! Keep reading for my first impressions.
To Lend Or Not To Lend, That Is Not The Question
There are lots of places you can go these days where you can borrow money. Banks, lending institutions, pay day loans, car note loans, and even your uncle Tito, and I think to myself “Why do they all do it?” Lending is profitable in almost every situation, plain and simple. The person borrowing is at a disadvantage and the terms are always in the lenders favor. It's not often that the average person gets to lend out what they have for a decent ROI (return on investment). If you can lend on your terms and can afford to lose it, then yes why wouldn't you? Do you think these banks are losing money off of lending it out?
What is Bitconnect?
Bitconnect is confusing at first to be honest. They have a nicely designed website and the info is laid out well, but when I first got there to explore there were so many things going on in the BCC world.
Each one of those links goes over an aspect of Bitconnect. I decided to test all 4 and I started with the Investing part as that seems the most controversial.
Bitconnect Investing: Day 1
So the way investing works is a bit complicated for sure and is what many would consider the scam part. Is Bitconnect a scam? Well I have heard a lot from both sides and it may be true that just holding the Bitcoin would be more profitable, but we are going to give it an honest go that way other cryptocurrency beginners will get to see the results. Here is how Bitconnect describes the Lending platform:
“You can invest BitConnect coin in Bitconnect lending platform exclusively from the BitConnect Dashboard. This investment option involves profiting from Bitconnect trading bot and volatility software. You will receive daily profit based on your investment option. Upon investment term completion, you will receive your CAPITAL BACK to take out from the Bitconnect lending platform or optionally reinvest back in lending platform to continue receiving daily profit.”
So the gist is you invest Bitcoin for a set period of time (in my case I invested $1010 of Bitcoin for a 239 day return of my money) and their software does trading and your BCC gains interest every day. Here is the tricky part, you only get the original amount in USD that you put in so I will get $1010 at the end of my 239 day “loan”, but I do get daily interest payments (around 1% on average) on it as well. What I don't get is the increase of value of my original Bitcoin. It is also unclear on exactly how the daily interest is generated besides this trading bot that is also not clearly described.
As you can see here I did a loan of $1010 or 12.58190697 BCC to the Bitconnect Trading bot and my capital will be released after 239 days. Now, I did purchase my BCC when it was at a very low point against Bitcoin so that helped me to get the biggest bang for my bit.
Other Aspects of Lending
There are 2 other main aspects of lending that I won't be participating in just yet. The first is the most controversial and it is the affiliate marketing. Yes you get an affiliate link and if people sign up using your link you do get bonuses. The other aspect of lending is the “reinvest”. This has been popular among many I have seen online also documenting the platform as they invest where you take your daily returns and reinvest them as a micro loan and then start earning interest in them as well. The issue with this that I see is each new $10 or $20 loan has its own return cycle at 299 days. It may be worth it, but I am going to hold off for now.
First Days Return
I waited 1 full day to write my first day review post so I could see what my return was. Sure enough I have about $10 in my Lending Wallet now in an interest payment for 1 day which of course is about 1% of my investment.
I would say so far so good, but I don't like to count my chickens until they hatch. I will continue documenting my Bitconnect loan every week on my blog as well as getting into their other aspects of Staking, Mining, & maybe even some Trading.