What is Bitconnect?
Bitconnect is a P2P blockchain network with decentralized capabilities. Its goal is to become the world’s most cherished Bitcoin lending platform. Like other similar networks, this community is powered by Bitconnect coin, which is essentially its cryptocurrency. The distributed nature of its ecosystem lets people store their wealth there without using government-backed coins. This means, whoever holds Bitconnect coins gets a substantial interest for assisting in the maintenance of its network.
Bitconnect promises financial freedom to those individuals who find the centralized banking systems and the promises of third-party financiers to be unreliable. Note that Bitconnect and Bitconnect Coin (BCC) operates along different lines. The former operates as a lending platform while the latter is a token used on the network. BCC’s value increases when you hold it for a long-term. Their 1% increase in users’ holdings per day is pretty lucrative, but some folks think it’s too good to be true.
How it works
When you buy BCCs from Bitconnect foundation, that amount is considered a loan which they use to buy Bitcoins. When Bitcoin’s value increases, Bitconnect’s ROI jumps a notch higher, and a portion of those profits is given you as well according to the size of your holdings. Find out more about their lending platform and interest rates.
Where to use BCC
Currently, BCC is accepted by very few minority companies and traded amongst the community users. Anyone who adopts this currency either does it to expand their investment portfolio or just in the belief that cryptocurrencies are here to stay.
Pros of Bitconnect (Bitconnect was shut down)
Valuable – the moment you buy BCC and hold, its value starts to increase since it’s an interest-bearing asset.
Faster transaction – unlike Bitcoin’s sluggish transaction period, Bitconnect has a shorter processing duration thanks to its Scrypt encryption algorithm.
Combines both PoS and PoW – when proof of work is merged with proof of work design, more efficiency is attained and less power is used.
Cons of Bitconnect
Still struggling to prove its legitimacy – Bitconnect is required by the UK government to prove their legitimacy or risk being dissolved.
The company behind it is not well-known – there is very little info online regarding the company behind this venture. This is usually taken by shrewd investors as a sign that a company lacks a clear roadmap ahead and should not be backed.
SCAM and is shut down – Bitconnect has been widely regarded as a scam by many for suspicious business practices, too good to be true product, and many grammatical errors throughout the website. In January of 2018, Bitconnect was shut down.
Pro and con
Bitconnect uses Scrypt algorithm rather than SHA256 to validate transactions. This technique makes the platform faster at executing transactions but at the expense of robust security offered by SHA256.
Where to buy Bitconnect
(Not recommended to buy Bitconnect) Anyone looking to buy BCC can use Bitconnect Site, Livecoin, Hitbtc, and Novaexchange.
2018 hasn’t started well for this digital asset. It has been issued with a cease and desist order by the Texas State Securities Board on two allegations. First, it is blamed for not disclosing how its investors are going to be paid. Secondly, it’s been using dodgy language and not informing investors about the risks of trading in cryptocurrencies.
Towards the end of November, UK government also issued Bitconnect with an ultimatum to prove their legitimacy or be dissolved and its assets impounded. Bitconnect was deemed a ponzi scheme in January of 2018 and was shut down.