The Inevitable Has Happened at BitConnect
BitConnect always did ring alarms bells with me, for they offered a service, if you can call it a service, whereby they offered a lending type scheme, in which people could buy their tokens but only in exchange for Bitcoin.
They then set to work their “amazing trading robot” to place trades on the value of Bitcoin that would guarantee a very healthy return to all of their clients. The only place you could buy or sell BitConnect was on their digital exchange!
They also offered much higher “interest” to clients who invested larger sums, and also had a bonus or referrer type of scheme in place whereby any of their clients could earn a percentage of the income people they referred to BitConnect made from their investments too.
The guaranteed returns, coupled with the fact investors could only join by turning their Bitcoin into BitConnect tokens, and the fact there was also that referrer scheme in place did, to a lot of people shut out “Ponzi scheme” to a great many people.
However, many people were taken in by it, and it would appear that the whole house of cards for BitConnect has come tumbling down, and the value of BitConnect tokens has fallen by 90%.
That should be a lesson learned for those novice investors, but should also act as a way of warning anyone about to invest in any type of digital currency to always be on the lookout for such schemes!
Don’t Be Taken in By the Hype
At the time of writing this news story there were 1448 digital currencies available, and as such anybody who is interested in investing in any of them does have a lot of them to pick and choose from.
What most soon to launch digital currencies are going to be offering are bonuses and additional coins and tokens to those investors who pre-buy a supply of them before launch, and whilst there is of course nothing wrong with offering such deals it is certainly the case you need to take a long hard look at what each of them also have to offer you.
For a digital currency to prove popular and be one that people are prepared to invest in they must offer something unique, which to be fair many of them do, but you should not be taken in by the hype surrounding some of them.
I am aware of a number of bloggers and V-loggers who are using their blogs and YouTube channels to get people to buy certain digital currencies which have no merit or unique selling points, and they are doing so either due to the fact they are paid to promote them or to try and boost the value of their holdings in those digital currencies.
It really is like the Wild West out there currently, and if you are seriously thinking of investing in any digital currencies for h very first time, then you owe it to yourself to learn more about and fully research each of the ones that do appeal to you.
There are No “Experts” in the Cryptocurrency Environment!
Being such a new environment, you are going to find that a great deal of people are now proclaiming they are experts in the cryptocurrency environment, and there is nothing stopping anyone from proclaiming such.
Until the environment matures fully and there is some form of regulatory procedure in place (which currently is a long way off if it is ever going to happen) or some of the major financial and banking institutions start to launch their own digital currencies, then any investments you make into any of them are going to be at risk.
The only person who is going to know whether investing in any digital currencies is something that is suitable to you, based on how you look at risk is of course you and no one else.
So please, at all times keep in mind that anything you do read online or see on YouTube in regards to which cryptocurrencies you should invest in should be taken with a pinch of salt, and you will be best advised to take however long it takes to research each cryptocurrency and then make your own mind up as to whether you should invest in any of them or not.
If something does look too good to be true, and I am thinking BitConnect here, then it probably is, and your money will always be at risk when signing up to such a scheme!