Here’s some not so surprising news. Bitconnect closes its lending and exchange platform, and the price of their Bitconnect coins fall more than 60% over the last couple of days.

At the current moment, all cryptocurrencies are experiencing a varying decline in percentages ranging from 10% to 45%. Some have realized a sharp decrease in the prices of their tokens or coins. These few that have realized losses that are much more than their peers may have more profound structural problems that have hit them a bit harder.

The woes for these sort of cryptocurrencies may only just be beginning.

The great fall of Bitconnect

The writings on the wall have been evident for Bitconnect. Authorities in various countries and states are issuing cease and desist letters and taking more actions to stop what is perceived as either fraudulent or misleading activity by Bitconnect.

Many members of the community have expressed their concerns about the company, and its practices and several have accused it of being a Ponzi scheme.

Bitconnect, which astonishingly, had a price of $430 on January 9th, took a sharp fall over the course of the next few days, where it fell to the $300 range and then fell further to the current price level of $26.00 over the course of the next few days.

The company has announced that they will be closing down their investment and lending platform. The platform served as a critical component of the company because most of the interest in the company came from precisely that, the concept of interest. Investors in their platform were led to believe that they would receive an extraordinary amount of returns and thus, they flocked to it. Bitconnect promised returns as high as 40% percent and one percent daily.

Comments from the company

The company has recently sent out a post called “Changes coming for the Bitconnect system – Halt of lending and exchange platform.

They noted in their post that they are closing the Bitconnect Lending and Exchange Platform and will be doing so “immediately with the release of all outstanding loans.”

The post goes on to state they will be transferring all lending wallet balance to respective individual wallet balances at the 363.62 exchange rate. Users will be able to withdraw their bitconnect in QT wallets as well. They go on to state they will be closing their BCC exchange within a  timeframe of 5 days.

In summary, they will be closing their lending and exchange service while their site will continue to operate, their wallet service will continue to operate and will still be disseminating knowledge and information.

Their reasons for closing the lending and exchange platform?

  • Consistent negative press leading to a lack of confidence in their platform
  • Their run-ins with regulators from the state of Texas, North Carolina, and London
  • They have experienced DDoS attacks which were guaranteed to continue if they were in operation.

But they will continue to have the Bitconnect coin floating and will seek to have it listed on other exchanges to provide for more liquidity.

In the meantime, they are working on building an exchange platform and will be running BitConnect X ICO.

Surprisingly, Bitconnect X ICO was one of the practices that the State of Texas pointed out as an issue and named it in their cease and desist letter.

Bloody January

In what some may see as a bloody January, will those that are projects and coins of substance rise to the top?