Bitconnect Still Haunts Crypto World, Mentioned in US SEC Decision on Bitcoin ETF

Activity around Bitconnect on social media keeps heating up, with suggestions of the platform’s relaunch potentially coming soon. The activity is centered around a Discord channel where a concerted Steemit campaign is being coordinated. Additionally, there is a mention of BCC coins still held in wallets and possibly reused again in a new scheme.

BitConnect finally pulled off the exit scam in January, as the bear market wiped out Bitcoin (BTC) prices and made the scheme non-viable. BitConnect was a pyramid scheme of lending, which tried to survive for longer by pruning the layers of the pyramid. But finally, it could no longer rely on new buyers to pay out older entrants, and the price of BCC crashed from as high as $500 down to $0.50.

But perhaps the most significant development is the fact that Trevon James videos are continuing - this time, not directly related to BitConnect, but containing attempts to gather likes, and make appeals to the community. James, one of the most prominent BitConnect promoters on YouTube, talks on general crypto topics and even mentions “fake mining” Ponzi schemes.

https://twitter.com/BitcoinTre/status/1032774563954741248

The other active promotion comes from the BitConnect store, selling T-shirts with logos or iconic images related to the BitConnect scheme:

https://twitter.com/BitconnectStore/status/1032751960167002112

For now, BitConnectX has not launched since finishing its ICO sale. There are also no clear calls to participate in new BCC purchases to get returns from the lending scheme.

However, BitConnect’s reputation continues to affect the world of cryptocurrencies. In a document released by the US Securities and Exchange Commission this Wednesday, BitConnect was mentioned as an example of the prevalence of volatility and scams in the crypto space.

“One commenter states that it is common knowledge that the bitcoin market is being manipulated and asserts that BitConnect, which was recently shut down and had promised risk-free annual returns of up to 120%, is an example of Ponzi and multi-level marketing schemes that are too common.”

The mention of BitConnect in the discussions leading up to the ETF decision brings back memories of the time when Bitcoin itself was called a scam.

“This commenter argues that the Commission should not send the wrong signal to bitcoin manipulators—who, the commenter asserts, currently operate with impunity—by approving a bitcoin ETP,” the SEC continued in another rejection document.

It is unknown if BitConnect manages a Ponzi scheme of the same size, given its reputation. But the observations of the SEC show that the infamy may have hindered mainstream crypto adoption for now.