Bitconnect

Aug 22 2017

The ABCs of Passive Crypto Income

EDITOR’S NOTE: On August 22, we were able to learn a few more things about AMBIS, the business referenced below as the “A” in the “ABCs.” We’ll share those below in the section marked “ABCs – A is for AMBIS.”

As a result of our continued due diligence, we have no choice but to remove all affiliate links for the AMBIS program. We’ll explain the reasons below.

Bitcoin, the original “cryptocurrency,” spawned hundreds of other currencies, but it also spawned a few other ways to potentially earn passive income through your crypto investments.

Since we’ve been at it here – this website goes back to March of this year, you can read our first post here, and “my how we’ve grown” – we’ve been able to try out quite a few sites that can potentially add passive crypto income to our wallets (and, of course, to yours as well). They fall into two general categories: (1) Lending and Volatility Trading and (2) Mining and Staking.

This post will walk through the ABCs of Passive Crypto Income but, to be honest, we’re more familiar with the machinations of category (1): Lending and Volatility Trading. We’ve dabbled in mining and staking sites, and we’ll continue to do that as the days go by. But, since we know more about lending, bot trading, and using volatility to your advantage, we’ll devote most of our time to that. (We’ll give you a link to two mining/staking programs that you can explore on your own; we promise a more exhaustive study in the next few weeks.)

Throughout this post, you’ll find AFFILIATE LINKS and banner ads – clicking on them and signing up through them can give us an affiliate commission, and we’re most grateful for your support. The more signups, the more time we can devote to continuing to study this space, and the more valuable information we can continue to bring you.

It’s time, though, for the CAVEAT and DISCLOSURE stuff: this is not investment advice, not trading advice, and you should seek the counsel of an investment professional, a financial professional, and your tax and legal counsel. Past performance does not guarantee future results. Bitcoin and cryptocurrencies are highly speculative instruments – do not spend more on them than you can afford to lose.

Let’s Begin: Lending and Volatility Trading Explained

If you’re familiar with Michael Lewis’s book Flash Boys, you know that there’s serious money to be made with high-frequency trading. Buying and selling securities – even sometimes the same security – over and over again, even with tiny profits of pennies per trade, can lead to huge profits.

Bots have taken over the stock world: automated trading strategies, featuring algorithms that look for those edges and take advantage of them, are really nothing new.

So imagine a world that is closer to the Wild, Wild West, in that these are currencies and tokens that are not regulated, decentralized, and entirely made up of ones and zeros. It should be no surprise that bots are trading crypto over and over and over again. And that’s where these platforms enter the picture.

Why ABCs?

Ah, another method to our madness: three sites that we will share these AFFILIATE LINKS for start with those letters:

A is for AMBIS – which we can no longer recommend, see details below
B is for Bitconnect
C is for Control Finance

But the one we’ll focus on in this explanation is Bitconnect. Here’s a flashy banner ad for ya:

The reason we’ll start with Bitconnect is because they appear to be leading the industry, and that’s due in no small part to the coin that powers Bitconnect, BCC.

Its market cap as of this writing is rather huge ($658m) and its supply is low (6 million and change), which helps us to breathe easier.

Bitconnect calls it “Lending” because you are actually loaning BCC coins to them for them to power the volatility trading software. There is a term for the deposit you make; depending upon the dollar value (minimum of $100), your deposit is locked up for as many as 299 days.

In exchange for your lending your coins to them, they pay you interest on your deposit.

Here’s a chart of their recent interest payments:

Time for the caveat about language: we’re dealing with sites that are decentralized – Bitconnect’s most recent confab was in Thailand, so that’s the best guess as to where the closest thing to its nerve center might be – and ones whose websites are likely written by committee, written by computer programmers, and not written in plain English. I think the last sentence is actually the opposite of what’s at work here: if there is more volatility, there tends to be more interest paid back.

Here come the obvious questions:

If this is interest paid out DAILY, how in the heck is this possibly sustainable? How do I know this isn’t a pyramid or a Ponzi scheme?

Well…

There is no guarantee that any of this isn’t a house of cards. I’ll give you a couple reasons why it is likely legitimate – but I will also stress the fact that, with ANYTHING IN BITCOIN AND CRYPTOCURRENCY YOU MUST USE CAUTION.

Reason 1: Options and Derivatives

I look at these animals as somewhere in the same phylum as options and derivatives. In those cases, you’re not actually owning the security, but you’re owning a certificate that either gives you the right to purchase the security (an option), or a stake in a pool of whatever asset you’re getting a derivative of.

If you’re loaning your bitcoins to one of these platforms, you are sorta kinda purchasing an option or a derivative – it might be closer to, let’s say, a “Gold ETF.” It’s set to the price of gold and it is maybe a demand deposit in that you have $100 of gold if you have $100 of a gold ETF, but no one ever actually asks them to shave off the exact amount of gold.

Reason 2: Verified Returns

I’m a small player here – what is called in the trading vernacular “a minnow” – but I have 38 days worth of results to at least look at.

Here’s a snapshot from the Bitconnect site itself:

(Yes, I took a screenshot at the exact moment the site was refreshing.)

Here’s a copy of my Excel spreadsheet, showing where we started (July 10) and where it stands now:

I’ll talk a little more about the details below. But I want to share reason three next:

Reason 3: The Underlying Coin and the Blockchain

This is why I give Bitconnect the most ringing endorsement of the three lending and volatility trading sites I am using: the underlying coin (BCC) and the blockchain itself.

There is no argument that there’s more than enough froth in this market behind ICOs (Initial Coin Offerings), token sales, and cryptocurrency startups. The perception is that some of these ICOs are nothing more than the sock puppet behind Pets.com – limited business acumen, not much of a business plan, and a whole lot of buzz that eventually leads to an implosion.

In the case of Bitconnect, as we mentioned above, their coin is large. It is of course possible that their coin’s value could implode, or that Bitcoin’s value could implode, or both things could happen at the same time. But with the inflation control put in place in their own coin, and the inflation control in Bitcoin itself, stability – while not guaranteed – is more likely to happen with Bitconnect.

Then, once you have all transactions visible on the blockchain – as is the case with AMBIS and Control Finance and yes, those are AFFILIATE LINKS – you have less potential for an overnight disappearance.

Once again, and I’m going to say it over and over, these sites are not without risk. The blockchain and cryptocurrency is not without risk. So we’re presenting all of this information to help you potentially manage your risks; you will need to make your own decision as to whether you have the appetite for these sites.

Back to Bitconnect (the “B” in the “ABCs”)

You’ll see on the spreadsheet that I invested $110 on the 10th of July, then invested $20 again on the 26th of July. That was a “newbie error” on my part.

With Bitconnect, you need to manage your own account, and you are responsible for compounding the interest if you so choose. (We don’t have to tell you about compound interest and that Einstein said it was the most marvelous thing ever.) Bitconnect’s minimum reinvestment is $10, and reinvestments must be in multiples of $10.

We mentioned that your funds are locked down, but your interest isn’t. You can choose to reinvest it, or you can take the money out and do as you please. We choose to compound it because, let’s face it, that’s where the potential for real growth is.

Each reinvestment is, in effect, a new loan to the platform – and you’ll have to decide if you want your money locked up for, in this case, 299 days.

If you’re a “whale,” you may see value in holding onto your interest until you can invest a large enough sum to get the daily bonus. We’ve seen folks do that – and you can do the cost/benefit analysis of time vs. returns. You might not want your funds held up for the better part of a year, and that’s cool. Your call; we haven’t achieved whale status yet, so we haven’t done that math.

As we mentioned last week on this site, this is an experiment. Heck, all of crypto is an experiment. As for Bitconnect, it gets our largest thumbs up of the three sites.

Here’s that banner ad again if you want to sign up:

ABCs: A is for AMBIS (Updated August 22)

After further due diligence – as referenced above – we decided to remove the affiliate links.

We cannot recommend this program, for the following reasons:

They are not up front about the fact that they keep your Bitcoin. The phrase “Principal is locked forever” appears only on the front page of the site – it should be a more blatant warning, in our opinion.
Returns are only valid for a seven-day period (in our case). After that, you’re relegated to a 1% interest – still not bad, but…
The “Principal is locked forever” really does smart. Bitconnect will give you your money back after a period of time (120 days is the shortest), and Control Finance APPEARS to allow you to withdraw your money.
What else gives us extreme pause? The CEO, “Bradley Gough,” is a tough person to actually find on LinkedIn or anywhere else – and the company makes him sound like some sort of Bitcoin guru.

The heart of the team is our CEO, Mr. BRADLEY GOUGH. He’s been dealing with Bitcoin & Blockchain since 2011 & his ideas have always been innovative & ahead of time. AmBIS start was planned by him back in 2010 when he attended a conference dedicated to new Blockchain startups. It’s since 2010 that he’s been working on the concept with 2 more developers, Jan Grunnis & Mike Pearson, who have coded the main product of today’s Ambis – the perfect Bitcoin trading bot – AmbisBot.

Other partners in the team are Jack Wonderbilt, Tim Hankins, Lara Copeman & Dennis Krongmann. They are responsible for marketing & finance & report directly to CEO. We’ll be expanding our team in the near future.

Words like “perfect” are always tough to live up to.

IMHO, stay far away. We cannot recommend Ambis.

ABCs: C is for Control Finance

This one falls somewhere in between Bitconnect and AMBIS: Control Finance (AFFILIATE LINK) has pluses and minuses that give us a little more pause than Bitconnect, and less pause than AMBIS.

Pluses:

The interest rate is a sustainable 1%.
Website might be the slickest of the three.
Name is okay and at least doesn’t make you start Googling for the acronym (like we did with AMBIS; something about Automation and Bitcoin and Investments).

Minuses:

Instead of locking down your Bitcoin for a fixed term, you get the 1% for as long as you have an account.
Their banner ads are so over-the-top that I won’t share them.
Language skills are really pretty bad.

AMBIS has a US LLC – whether that puts your mind at ease, I don’t know – and Control Finance is incorporated in the UK.

Screenshots for this one:

We started small here: our original investment, counting transaction fees, was $105.31 worth of Bitcoin; while we put in $103.46 (good work finding low transaction fees, eh?) we received a bonus of $3.10 for signing up. Our starting balance was $106.56 on the site (so the bonus paid for our transaction fees and a little bit more).

Net net? We are up 6.34% in just a week.

We set this one to compound automatically, so we’re good on that front. We’ll just have to see how this one grows, too.

Other Thoughts on Passive Income

Passive income platforms abound in just about every industry – so it makes sense that these would start to follow in crypto. You’re going to have to ask yourself whether you want to focus on building a team (which is common in multi-level marketing, or MLM) or just sharing knowledge and looking for people to use your affiliate link.

In either case: this is actual work. For instance, I’ve lost track of the hours I’ve devoted to studying and researching the cryptocurrency space. I’m more than happy to walk folks through the basics – I did that just this week with a friend who was making his first purchase with Coinbase (yes, another AFFILIATE LINK), and it honestly doesn’t concern me so much if someone decides this whole crypto world isn’t their cup of tea. Or if they get into one of these programs and use their own affiliate or referral link so they can be compensated.

Two things I’ll suggest – and this is not investment advice or legal advice or any of that:

Spread out your risk. Gosh, we’ve probably talked about that throughout our journey here. If you have all of your eggs in any basket, that could spell trouble.
Do the math but don’t get carried away. You can find tons of videos on YouTube that talk about the staggering compound interest possibilities here. All can cause for minor heart palpitations – the good kind – but there’s, again, tremendous risk in cryptocurrency.

Wow…More than 2000 Words!

That’s right, we’ve told you lots about this world. And we’re here for questions: be sure to follow TeamMetacoin on Twitter and Facebook for more insights.

Aug 10 2017

On Testing and Learning

If you think you have all the answers, you probably haven’t asked the right questions.

I don’t know where I first heard that maxim, but boy does it apply to cryptocurrency, Bitcoin, and this learning experiment of ours.

What…you don’t think this is an experiment? This entire space is an experiment: the whole concept of Bitcoin is only eight years old, and the goal posts continue to move. We’re ten days into August of 2017, a month that began with The Great Fork and launched a new currency that seemed headed for the stratosphere – and then came back down to earth – and then the mother ship that launched it decided it would reach for new heights.

If you’re not Testing and Learning, then you’re probably doomed to fail. And if you think you have all the answers, start asking more questions.

Exhibit A: Altcoin Du Jour

Each day brings with it a new “Altcoin” that will take off – if you believe the Twitter experts – and if you don’t get in on the ground floor of this coin, be prepared to cry a river once those early adopters pump it and sell it for their Lamborghini. (We’ve taken to calling them “Lambo Coins,” because that seems to be the auto of choice for the crypto people.)

But…

The prevailing wisdom – and I tend to believe this – is that, of the hundreds of coins and tokens out there, once we’re past bubble territory, a handful of them will be worth something. The rest? Dust. Vapor. Ones and zeros.

We’re not near bubble territory yet, though – and that still creates opportunities for even the most casual of traders.

Which is where the “test and learn” concept comes in. If you’ve been following this site at all, you know we have a couple of hypothetical portfolios; these experiments have ranged from one that does okay (the Hedge Fund) all the way up to one that would have made tons of money (the BRED Portfolio).

You also know that we’ve shared some other experiments – posts on coins that COULD go stratospheric, and lists of coins that we think might be good fits for a more speculative portfolio.

And these range in success from okay down to meh.

Because it’s an experiment.

Exhibit B: Passive Crypto Income

That’s probably the best category to call these other things, lending/interest platforms like Bitconnect (which we told you about a couple of times and which we’re still monitoring; use that AFFILIATE LINK to get started if you want to try it out for yourself) and its competitor Control Finance (which we’re investigating as we speak; it appears to be free to sign up, so we have an AFFILIATE LINK over there for that one, too). Or there’s a mining program called Microhash that we just signed up for yesterday. (AFFILIATE LINK.)

Since we’re still learning, we’re asking some questions about these particular platforms:

Are they legitimate?
Are the revenue projections realistic?
What’s the potential for anyone to take their blocks and go home?

Answers:

Well, they appear to be…as far as we can tell from what we’re finding on the internet…but things aren’t always what they seem, right?
Well, that’s an interesting question…we don’t know, and it might take a while for us to find out.
We’re quite familiar with Mt. Gox – that’s ALWAYS a risk.

The issues, for this site and your intrepid reporter/guinea pig, stem from sustainability – are these platforms really creating systems that can allow someone to passively, casually, create the kind of income that could be life-changing? And, if they do, can they continue ad infinitum? Or will there be a crash and burn element that is going to get ugly?

The more that I study this space, the more I believe the following:

Bitcoin, the blockchain, and the cryptocurrency industry together create the potential for the largest transfer of wealth in human history.

But…it is still an experiment.

What’s The Point?

Sitting on the sidelines may be an option for you. Some people do prefer just casually going about their business while small changes happen around them; and maybe those small changes won’t turn into big changes.

But for us…the answers are out there, and we plan on testing and learning and asking more questions as the days go by.

Join us.

Aug 09 2017

11 Ways to Get Started Now

Just like anything else, at first the whole concept of Bitcoin, the Blockchain, and cryptocurrencies can seem really overwhelming.

Imagine walking into a shopping plaza in a foreign country, not speaking the language, and not really knowing what any of the products are. That’s this space…at first.

But once you get the hang of some of the concepts, it’s not that bad. Really.

In that vein, we present a post that could actually be an ebook. It’s called 11 Ways to Get Started Now.

DISCLOSURE: some of the links on this page are AFFILIATE LINKS, and we’ll do our best to blatantly identify them as AFFILIATE LINKS. That means we may be compensated if you set up an account or make a purchase.

Here goes:

1. Get a Coinbase Account

Let’s face it, there are really two big categories of Bitcoin users: the hardcore ones – mining rigs in their basements, wallets on all sorts of machines, exhaustive lists of which coins are PoS and which are PoW – and there are those who just tuned out at everything you just read.

If you’re in that second camp, Coinbase is for you. (THAT’S AN AFFILIATE LINK.)

(If you’re in that first camp, you might actually have started with a Coinbase account, but you don’t want to admit it.)

Coinbase offers the most silly simple service you can use to get into Bitcoin – or Ethereum or Litecoin; those are their three currencies as of right now – and you can link it through a US bank account or a credit card. (We are based in the US, so we

Note that Coinbase will actually give you a bonus of $10 worth of Bitcoin when you set up an account, so using our link actually benefits you as much as it benefits us. (But it probably benefits you MORE than it benefits us, since you are now “in the game.”)

2. Transfer some of your funds to one of our three favorite exchanges

First, let’s explain an “exchange” vs. a wallet/purchase platform such as Coinbase. Simply put, exchanges where you can trade cryptocurrencies are like stock exchanges were you buy and sell stocks.

Dozens of exchanges are out there, but we have so far only used three:

Poloniex. We used this one first. “Polo” is based in the USA. Most of the largest coins by market capitalization are traded here.
Bittrex. We started using this one a month or so after we started with Poloniex. It, too, is based in the USA. If you hear about a “small cap altcoin” (small market capitalization, alternative to Bitcoin) that isn’t traded on Polo, it might be traded on “Trex.”
Cryptopia. THAT’S AN AFFILIATE LINK. It’s based in New Zealand, so if you want to feel all exotic, trade there. Speaking of exotic, we’ve got a decent chunk of small cap altcoins over there. “Topia” is their common abbreviation.

Ask people about their experiences with these and you might get a varying degree of answers; our own experience has been just fine.

3. Get a Steemit account…get paid to blog?

I’ll admit, this is the most fun I’ve had with any site since the early days of Twitter. Steemit is pretty cool – you’ll find all sorts of people there, with all sorts of interests.

It’s a social network that is powered by a cryptocurrency of its own, Steem. You’re given a certain amount of “voting power” and you earn more power through more interactions. It can get a little complicated, but suffice it to say you can start to see some results – a few dollars here and a few dollars there.

I don’t do it for the money, though – I’m there to trade ideas with others, and to find out what folks are thinking a bout a variety of topics.

4. Investigate coins at CoinMarketCap

CoinMarketCap.com, or CMC, is the leading site for getting a snapshot of what is happening with cryptocurrencies. Pretty much all of them are listed here, they’re ranked by market cap, you can see what’s trending up or down or sideways.

Here’s where you can keep track of the Crypto Unicorns (those coins with a market cap of $1 Billion or more), all the way down to the tiny market cap coins that, again, seem to dominate our Cryptopia account.

5. Start Lending at Bitconnect

We did a pretty big write-up on this one last week. That write-up includes several AFFILIATE LINKS, but if you want to cut to the chase and just get started, here’s an actual banner ad you can click on.

In our post the other day, which we tried to make “warts and all” in nature, we did mention our skepticism around this lending platform. As with ANYTHING in this space, remember to do your own research, to seek the advice of tax professionals and accountants, and to not invest more than you can afford to lose.

We still consider Bitconnect to be rather speculative in nature; but we’ve also studied the coin behind the solution, and it has a large market cap ($540 million-plus) and we don’t think the coin itself is going anywhere.

6. Lock up some coins in DOT at Cryptopia

If you tend to be impetuous with your trades, you might want to consider cooling off a little – and one way to do that is to lock some coins down in an interest-bearing coin such as DOT, which helps to fuel Cryptopia. (AFFILIATE LINK over there.) For a minimum term of 90 days, you can receive interest at 0.5%, compounded monthly, with higher rates for longer-term deposits.

Once you’re on Cryptopia, you’ll need to mouse over “More” and then “Term Deposits.”

7. Buy a Trezor, store your coins offline

We love this little device so much that we joined its AFFILIATE PROGRAM (here’s the link).

What you’re doing is moving the keys for the coins you own (that are supported by Trezor) over into cold storage, on a device that you own that can’t be corrupted.

If you have a decent amount of coins, you’ll want to explore Trezor.

8. Invest in an ICO

With all the news surrounding ICOs, you wonder why we have this so far down the list. Well, ICO investing is A LOT of WORK. You want to research them thoroughly, and you’re still making a leap of faith.

Hands down, ICO Countdown is the best service for this.

We’ve got an okay track record so far getting involved in ICOs, but one thing that gets in our way as an American site is that we’re Americans. Some ICOs won’t let you participate if you’re an American citizen or even an American expat living abroad.

9. Visit the Bitcoin news sites

The ones that we like the most are Coindesk and CoinTelegraph. Both may, at first, seem over your head. That’s okay. We’ve got to start somewhere.

10. Set up an Automatic Investment Program

This is one of those super-simple ways to “set it and forget it.” Just hop on over to Coinbase and, when buying your next batch of Bitcoin, Ethereum, or Litecoin, ask to repeat that purchase daily, weekly, every two weeks, or monthly.

You’re “averaging in,” or “dollar cost averaging” your crypto purchases, so that’s another way to smooth out your returns and your risk.

11. Think about a Bitcoin IRA

Yes, that’s a thing. Bitcoin IRA is the world’s first and we’re sharing this link as a public service – we’re not in their affiliate program and we haven’t gone this route ourselves. Yet.

You can search and find a few other links – some ads, some not – but, in our limited investigation of these, this appears to be the best and most reputable service.

Wow. 11 Ways to Get Started. We’re exhausted now, so we’re going to take a break. But you…you should really consider getting started…look around and consider getting into the Bitcoin game.

Aug 04 2017

Bitconnect – How Are We Doing?

We’ve been trying an experiment here at Metacoin HQ: can we use a small amount of capital on the Bitconnect platform and see the kind of results that make it a worthwhile investment? This post will contain our BITCONNECT REFERRAL LINK quite a few times – so you can read on and decide for yourself if you think it’s legit. We’re not here to sell you on the platform – you can make that decision on your own; if you do decide to join, use the link above and warm our hearts appropriately.

To that end, here’s a disclaimer before we dig in: Do your own research. With anything in this rapidly changing and evolving crypto space, past performance may not be indicative of future results. Your experience may vary. Also, be sure to talk to your own legal advisors and accountants and tax people. We’re not responsible for any successes or failures of yours: your investments are entirely your own responsibility.

OKAY, y’all…let’s find out what’s really going on with Bitconnect.

First up, the difference…

…Between the Bitconnect coin and the Bitconnect “Volatility Software.” We think it’s really important to understand where one stops and the other begins. (BTW, what follows is a banner ad that we found; it works like an affiliate link.)

The Bitconnect Coin is ranked 15th by market cap, according to Coinmarketcap.com. Here’s a screenshot of some of the statistics:

Upshot for those who don’t want to study the details – in case you don’t want to, say, examine the blockchain behind it – is that it’s sizable enough to not go anywhere. Legitimacy is key, because you’re buying the coin first – that’s a must – in order to have access to the volatility software. Were this a coin with a low market cap, you might ask a few hundred more questions.

The flipside here, though, is the “Mt. Gox” element of ANYTHING IN THIS SPACE. There could be a hack, or an inside job of some sort could cause large chunks of the coin to disappear; the Bitconnect coin could plummet in value, leading to a “run on the bank.” Or the founders and large “whales” with lots of BCC could dump the coin, which could have the same effect.

So that’s the risk with any of these coins – the risk, in our view, may well be exacerbated by the fact that there’s that volatility software element. It’s the man behind the curtain: we don’t know how he (or she) operates, and his run of magic may come to an end.

Now, Let’s Invest – or Lend – or…

When we first “went there” a few weeks ago, we said the same thing we’re saying now: it’s an experiment.

It’s a simple process: take your Bitcoin – you of course need to get some first, which you can do with Coinbase by using that affiliate link over there- and convert it to Bitconnect. Using their platform is the easiest way (though you could use one of the exchanges on which BCC trades, too) to convert the coins.

Once you have the coins in hand, you need to “lend” them. And, our best guess here is that you ARE technically lending your coins – but you’re lending them to the Bitconnect folks, who then take their volatility software and work their magic.

For us, this process was a little bit of a pain. We decided to bite the bullet and actually get into the mix on a day when prices were plummeting on all of the exchanges. And we moved coins back and forth and money around just enough to get $110 – $10 more than the minimum – into the system.

Our journey was now underway.

How it Works, Part 1

Once you have invested in the platform, you will need to keep a couple things in mind. One is that you are now saying goodbye to your money for as long as 299 days. See this chart:

That’s right: my first investment was on July 10, 2017. I will not see my capital return until May 5, 2018. If you remember those “substantial penalty for early withdrawal” notices you used to hear about bank CDs, well, this takes it to a new level. Your funds are locked up and you will not see them.

However, you will see the interest, and that interest is something you can withdraw at any time.

The Interest

Here’s what that interest has looked like for the past five days.

Interest is tabulated daily, but it is tacked onto the original investment amount only.

The beauty of compound interest has been talked about over and over, so we won’t give you all the Einstein platitudes about it. We will tell you that you will have to do the actual compounding. That’s right, playas, you need to reinvest on your own in order to compound.

This is a rather important fact – and one that we actually missed for a few days while we were focused on other things. Yes, we’ll be more diligent next time.

The Actual Results So Far

Some notes about the above:

Though the minimum buy-in is $100, the minimum amount to reinvest is only $10.
This reinvestment must be done in multiples of $10 – so we could technically have reinvested after eight days.
They take what’s left over and call it “leftover” and put it back into your account.
When you reinvest any amount, it is locked up for 299 days (unless you are reinvesting an amount that’s greater than $1010, which cuts your “lockup” time by 60 days).

The Referral Program

This is where it gets…well, interesting. There’s an element of this that is old school affiliate marketing – “hey, here’s our Referral Link” is something you’ll see all over the place, and it’s why this is the third time we’re mentioning our own link in this blog post.

But where it’s even more intriguing is that there’s also an element that is similar to multi-level marketing. That’s right, by nature of my signing up, I’m now in someone’s downline. He gets commission when I invest or re-invest, and I get commission when someone I refer invests or re-invests.

This all has me wondering whether or not this is a sustainable business model: at some point, we’ll all run out of people to invite to this system, and the value of Bitcoin might drop, or the entire crypto universe could render itself obsolete.

Another Note of Caution

Sustainability is a really big buzzword: more than just “is this environmentally sound?,” sustainability can and should include questions such as “will this business be able to continue?” More endemic to this discussion – is Bitconnect here to stay?

I don’t honestly know. That’s why I gave you several up front caveats.

Now, in theory, with a total number of coins in circulation that’s right around 1/4 of the total coins to be created, Bitconnect may very well have the inflation thing down. And, since they advise you to “pay no attention to the man behind the curtain,” what we don’t know about the system may be an okay thing. High-frequency trading can certainly throw off percentage gains here and there that eventually add up, and perhaps this system does that in such a way that it can be sustained as long as Bitcoin remains somewhat volatile.

But it could also come crashing down. My 299 days could balloon to infinity if the money all of a sudden isn’t there.

These are risks throughout cryptocurrency, and this is why you are advised anywhere and everywhere in this space to only invest that which you can afford to lose.

Projections Are Also Dangerous…

I mean, really…do we think that 30% returns are sustainable on an annual basis? 30% a month is…well…nuts.

My math tells me that the original principal of $110 would, if it continues and I continue to compound, turn into $2500 in one year.

Once you see a projection like that, you start to think: “well, what if I invested $1100? OR $11,000!!!”

Here’s what I’m going to commit to doing: I will keep an eye on this coin, this project, and this system, and I’ll keep you up to date on what I learn. Warts and all.

Color me still intrigued, a little skeptical, but willing to ride this out and see what happens.

And here’s that link again, in case you want to join us.

Aug 01 2017

Here Come the Altcoins

In the Bitcoin universe, it seems most everyone has August 1 circled, starred, underlined, and highlighted on the calendar. Today’s the day of the “Hard Fork,” or the “Soft Fork,” or the end of life as we know it, or the beginning of the Bitcoin bull run.

Strategies for investors have been all over the map: sell all altcoins – those other cryptocurrencies, ranging in size from billions in market cap (Ethereum, Ripple) all the way down to that one “crap coin” that might go 10x or 100x (or 1000x) – or buy this altcoin or that altcoin and hold on for dear life. And then there’s BCH – Bitcoin Cash – aiming to become that fork (hard or soft, we’re not sure) that sets the world on fire. Or gets sold en masse once we figure out who is holding what.

Carp Coins — We don’t use the word “crap” round here, preferring “carp.”

A quick screenshot from this morning, though – 8:15 or so Central Time in the US, well into first day of the new era in other parts of the world – tells us that maybe the “hold the carp coins” strategery might make a little sense.

Nice little run, right? Everything is green – positive growth for the most-recent 24-hour period.

Were it that simple, though, practically everyone would have chosen altcoins as their post-fork, August 1 and beyond strategy.

Making sense of the nonsense

I’ve witnessed a whole bunch of craziness during the past few days. To wit:

The creation of BCH – which was originally making the rounds as BCC, but BCC is the ticker for Bitconnect (where you can lend out your Bitcoin, sorta). (Use that affiliate link if you want to explore it, it’s an interesting site and the interest possibilities are rather crazy.)
The lending madness on Poloniex, where people have loaned out Bitcoin at rates of 3 to 4 percent per day, on average, as others borrow the Bitcoin for their margin accounts and plan on, I don’t know, conquering the world.
The resilience of Bitcoin itself – which, let’s face it, looks like a pretty stable investment right now, having really only oscillated between $2400 and $2900 USD during the past seven days.

Does this mean the Alts are back?

Maybe possibly.

We personally moved in and out of a couple during the past week – in fact, one of our favorites, Siacoin, dropped into the 250-260 range and we dumped it – with plans of maybe returning soon.

Bargains appeared to be everywhere: Ripple’s XRP token was in the 5000s, Library Credits opened its private beta to the public and still stuck around below 20,000 Sats.

Tea leaves are tough to read, but the diversified strategy might actually be the way to go here. Right?

One last word…

It’s August 1, and, honestly, your guess may be as good as mine or anyone else’s. Rapid growth of all altcoins? BTC’s re-resurgence, testing $3000? Flight into coins like ETH and LTC and XRP as large-cap alternatives? All of the above?

As always, do your own research. Seek out professional advice for things like taxes and legal ramifications of your moves.

But one bet: the whole space – all of crypto – will benefit from the attention. So sitting on the sidelines might mean missing out on an asset class that could get larger and larger from here.