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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

#31

Post by Pyxl101 »

spookthesunset wrote: post #18
BayesStreet wrote: post #11

Earlier quoted context omitted.

I'm aware that tether's reserves are a little doubtful, but could you elaborate on why Bitfinex is sketchy?

For starters, they don't deal in USD at all. They deal in "USDT", which isn't at all USD but a token called a tether that is somehow magically supposed to be pegged so 1 USDT == 1USD that you can... well... I dunno what you can do with a tether but one thing you can't do is turn it into actual fiat money on Bitfinex. You might be able to convert it to cold hard fiat on some other exchange though, but odds are good sa…

The fact that Tether does not guarantee in their terms and conditions that they'll exchange Tether back into equivalent reserve currency makes it _super_ sketchy from my point of view.

The only way that Tether should be considered backed by and equivalent to USD (risk-reduced) is if Tether is contractually obligated to convert it back into USD. Instead, this is what their TOS says:

> Tethers are not money and are not monetary instruments. They are also not stored value or currency. There is no contractual right or other right or legal claim against us to redeem or exchange your Tethers for money. We do not guarantee any right of redemption or exchange of Tethers by us for money.

> We make no representations, warranties, or guarantees to you of any kind, including with respect to any right of redemption or exchange of Tethers for any property.

For more on this, see my previous comment exploring the idea of "Tether being worthless": https://news.ycombinator.com/item?id=15997658

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#32

Post by dmix »

ceejayoz wrote: post #17
FLUX-YOU wrote: post #8

Earlier quoted context omitted.

https://www.youtube.com/results?search_query=BitConnect+refe... Jesus, this is pretty blatant.

Several of the "get referrals!" videos literally use pyramids in their thumbnails to illustrate the program. Holy crap.

There are plenty of large long-running "pyramid" structured marketing companies that are totally legal though. Just because it's a pyramid scheme doesn't mean it's a ponzi scheme nor automatically imply that it's exploiting people.

Just wanted to make that distinction. Not commenting on BitConnect directly.

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#34

Post by dmix »

znebby wrote: post #19

I'm just going to leave this here: https://www.youtube.com/watch?v=kbR1SXIje1U

Wow, what is the background on this? Was this an officially run conference in Asia or America?

The choice of hardcore metal and drunk nerdy business/financey people dancing seems like such a bizarre choice.

Although I'm not familiar with the typical ra-ra sales (or self-help) events these types of people seem to be from.

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#36

Post by [deleted] »

bhouston wrote: post #27
dudus wrote: post #14

Earlier quoted context omitted.

If you trade it for bitcoin someone is selling you that bitcoin for tether. That person will go ahead and trade that tether for some other coin.... rinse repeat, but in the end someone is holding that Tether, if exchanges stop accepting tether eventually your only option is to cash out to USD. USDT is basically being used as a trade coin, to avoid cashing out (maybe to avoid taxation) or to speculate on USD with the…

If $200M was printed today, then it likely doesn't exist. Hilarious that this is going on. At some point the music has to stop.

[deleted]

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#37

Post by saalweachter »

idbehold wrote: post #28
ceejayoz wrote: post #17

Earlier quoted context omitted.

Several of the "get referrals!" videos literally use pyramids in their thumbnails to illustrate the program. Holy crap.

The pyramid was literally on the Bitconnect FAQ page: https://youtu.be/wK0ztRcXvNQ?t=135

I mean, this being the internet, it could have started as a tongue in cheek joke and then when the money started rolling in the founders just kind of went with it.

Which I think is a potential lesson for HN readers: something can be funny, but still be fraud.

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#38

Post by znebby »

dmix wrote: post #34
znebby wrote: post #19

I'm just going to leave this here: https://www.youtube.com/watch?v=kbR1SXIje1U

Wow, what is the background on this? Was this an officially run conference in Asia or America? The choice of hardcore metal and drunk nerdy business/financey people dancing seems like such a bizarre choice. Although I'm not familiar with the typical ra-ra sales (or self-help) events these types of people seem to be from.

It was in Thailand.

Haha, I think the metal music was edited.

This seems to be the original clip: https://www.youtube.com/watch?v=7f18bv76QVs

Re: BitConnect Closes Exchange as States Warn of Unregulated Sales

#39

Post by sillysaurus3 »

dmix wrote: post #32
ceejayoz wrote: post #17

Earlier quoted context omitted.

Several of the "get referrals!" videos literally use pyramids in their thumbnails to illustrate the program. Holy crap.

There are plenty of large long-running "pyramid" structured marketing companies that are totally legal though. Just because it's a pyramid scheme doesn't mean it's a ponzi scheme nor automatically imply that it's exploiting people. Just wanted to make that distinction. Not commenting on BitConnect directly.

Yep. https://www.youtube.com/watch?v=s6MwGeOm8iI
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