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BitConnect Closes Exchange as States Warn of Unregulated Sales

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Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#231

Post by bonestamp2 »

ve55 wrote: post #5

For those unaware, Bitconnect was a Bitcoin-based ponzi-scheme that had operated 'successfully' for quite some time. I don't say 'ponzi' as an insult in the way some do for cryptocurrencies, it was quite literally just a bare-bones ponzi scheme, where you deposit your money (Bitcoin) on their website, buy their token, 'lock' your funds for some amount of time, and you are promised very high interest rates while encou…

> Bitconnect was a Bitcoin-based ponzi-scheme

Do you know that as a fact? I'm not trying to defend bitconnect, I just think it's dangerous living in a world where people state things as facts that have not been proven.

People often cite the high rate of return from their trading bot as "proof" that they're a ponzi, but I don't buy that because run my own bitcoin trading bot and the returns are more than triple bitconnect's average.

People much smarter than I who are running the same trading bot get even higher returns than I do. I think bitconnect's return rate was low because they were skimming the returns, which explains why they would take other people's money even though their bot works... because they can make even more by providing it as a service.

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#232

Post by Fnoord »

ebikelaw wrote: post #176
Fnoord wrote: post #87

Earlier quoted context omitted.

Google surely must have a copy, as well as Archive.org. These people benefitted from the scam; they should be held accountable as well.

I love these comments because they highlight the ambivalence of the HN commentariat. If google actually had copies of deleted user data, the privacy-minded would lose their heads. And they’d be right because there are all kinds of laws around this. Deleted user data has to be really gone, even from backups, within a finite time.

> they highlight the ambivalence of the HN commentariat

They don't.

This was:

a) Deliberately published (ie. not leaked)

b) By the uploader who is also the content creator (not e.g. doxing or copyright infringement)

c) Without breaching their own privacy (not e.g. posting a nude of themselves)

d) In this case possibly if not likely unlawful (hence warranting a police investigation)

e) For-profit (non-profit crimes have less priority)

Furthermore:

> Deleted user data has to be really gone, even from backups, within a finite time.

Sure, but we're talking -at this point- one or two days max here and we're talking about a scam.

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#233

Post by makomk »

benmmurphy wrote: post #207
mcintyre1994 wrote: post #123

Earlier quoted context omitted.

Isn't the entire point of it to be pegged 1USDT === 1USD? Obviously it fails at that by being backed by nothing like enough USD, but what does it being worth $1.07 even mean? Also, where do you sell Tethers given Bitfinex won't exchange them for USD?

doesn't the fact that its trading at 1.07 mean that tether doesn't have easy access to USD or an easy way to exploit the arbitrage. tether as a company can take USD and print tethers. so they could take USD $100, print 100 tethers, exchange them for USD $107 and walk away with $7 profit. i don't think people would even be mad if they did this. this is exactly what they should be doing to preserve the peg.

People have, in fact, been getting mad when it appears they may have been doing this because people are weird like that. (Though I don't think there's enough market depth for that particular Tether-related arbitrage to be profitable, unlike some of the other options.)

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#234

Post by dragonwriter »

52804375092485 wrote: post #180
paulie_a wrote: post #164

Earlier quoted context omitted.

Off topic: why do people put "I am not lawyer" disclaimer on posts? Ive rarely seen that sort of disclaimer about any other occupation

When actual attorney's are talking about legal issues, they'll usually say something like "I am not your lawyer" as a defense against entering into an attorney-client relationship which creates a bunch of complications. So I guess the "I am not a lawyer" is sort of a corruption of that, a magic spell invoked by not-lawyers to save themselves from not-problems.

Practicing law without a license is an offense in many jurisdictions; providing legal advice is in some cases within the scope of legal definitions of practice of law. (For people in certain roles outside of but around the legal profession, even implicitly holding oneself out as a lawyer or person qualified to practice law may have additional concerns.)

While public comment for which no one has been charged money may be outside of the bounds of what would be covered by most such laws, some people view it as best to be clear (and, in any case, such a disclaimer served as meta-legal advice that the matter at hand is one on which you should consult a lawyer if you have critical concerns.)

And, there are other concerned for lawyers in communications that might be mistaken for providing legal advice.

All that combined to justify disclaimers that include some or all of, as applicable:

I am not a lawyer.

I am not your lawyer.

This is not legal advice.

(Incidentally, I am not a lawyer, I am not your lawyer, and none of this is legal advice.)

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#235

Post by ForHackernews »

Nursie wrote: post #99
ForHackernews wrote: post #89

Earlier quoted context omitted.

There's a twitter account that tracks the printing of new Tether: https://twitter.com/tetherprinter There was another $100m invented 11 hours ago, in addition to the $100m created on Monday.

Jesus, they've printed 250 million of them in the last three days!

Another 100m right now. So 350m in 3 days?

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#236

Post by metamet »

throwaway413 wrote: post #230
metamet wrote: post #197

Earlier quoted context omitted.

No, but ponzi schemes and Crypto are on the same spectrum in terms of traditional financial advisement. Only up until very recently did Crypto as a whole break away from it, and BitConnect just happens to have its foot in both.

No they're not - they are separated by the fact that one's sole purpose is to commit fraud, while the other actually has to do - however much - with technical merit. The however much part exists in every other type of market..there is a subset of people that will always try to game the system of any system they exist within. This is nothing new. That subset can vary in size based on qualities of said market, yes, but…

You completely missed the part of my post where I said "in terms of traditional financial advisement".

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#237

Post by bonestamp2 »

alien_at_work wrote: post #217
allannienhuis wrote: post #62

Earlier quoted context omitted.

It's almost shocking how transparently dishonest they are. And yet people put real money (well, I suppose real bitcoins) into a black hole like this...

Most investors knew Madoff was cheating some how, they just all assumed they would get out in time.

Was bitconnect cheating though? I totally thought it was possible that they were a ponzi scheme until I ran my own bitcoin trading bot.

But, don't take my word for... if you look at bitcoin trading bots that you can run yourself (many example on youtube of people running their own), bitconnect's return rate was significantly lower than typical bitcoin trading bots.

So, if bitconnect was getting typical returns (and it's safe to say they should be getting at least 2%, which only puts them in the top ~60% of bitcoin bot operators), they could have been taking more than 1% for themselves and still returning their "high" level of returns -- without running any sort of ponzi scheme!

Seeing my own bitcoin trading bot in action led me down the path of investigating stock trading bots and high speed trading within banks. The more I learned, the more I realized the real ponzi schemes are the national banks. That sounds crazy until you realize that with fractional reserve banking, they can take (for example) $1000 that you deposit and lend out 90% of it -- they only have to keep 10% of deposits deposits in reserve! Yet, most of them pay you less than 1%/year in interest. If I can make 4%/day on $1000 in my basement, how much do you think giant banks can make with your $1000?

I would highly recommend running your own bitcoin trading bot if you've got $1000 to spare. I'll refrain from recommending a specific one for fear of sounding biased, but it will completely change your outlook on what bitconnect could be. More importantly, it'll probably make you a decent chunk of change that you can cash in at anytime (unlike bitconnect's CD model).

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#238

Post by snowwrestler »

52804375092485 wrote: post #180
paulie_a wrote: post #164

Earlier quoted context omitted.

Off topic: why do people put "I am not lawyer" disclaimer on posts? Ive rarely seen that sort of disclaimer about any other occupation

When actual attorney's are talking about legal issues, they'll usually say something like "I am not your lawyer" as a defense against entering into an attorney-client relationship which creates a bunch of complications. So I guess the "I am not a lawyer" is sort of a corruption of that, a magic spell invoked by not-lawyers to save themselves from not-problems.

It's an attempt to inoculate against the charge of practicing law without a license--which might seem incredibly unlikely, but that's how they got Ulysses Everett McGill.

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#239

Post by snowwrestler »

cfontes wrote: post #137
toomanybeersies wrote: post #59

Earlier quoted context omitted.

People love to think they're smarter than those 'experts'. It's a combination of Tall Poppy Syndrome [1] and the Dunning-Kruger Effect [2] [1] https://en.wikipedia.org/wiki/Tall_poppy_syndrome [2] https://en.wikipedia.org/wiki/Dunning%E2%80%93Kruger_effect

You can add to that that "experts" are pretty clueless as well, 2000 and 2008 are reminders of that. Close to none saw it coming and the ones that did where laughing stock amongst them, you have to be a pretty remarkable person to swim against National bank presidents, government officials and other high ranking people like Alan Greenspan, that was a super respected economist but also has made some of the worst mista…

Thank you for illustrating the tall poppy thing so well.
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