How can Bitconnect sustain?Bitconnect sustain?

Many times I have seen the question "How can this system sustain itself ?" Well, lets look at it from a mathematical point of view:

The BitConnect guys actually prepared themselves pretty well for the debut in late 2016:

they perform a pre-mine to generate at least 4.8 million coins

they adopted a Proof or Stake / Proof of Work system.

Proof of Stake essentially means that anyone holding BitConnect Coin in their wallet will receive interest on their balance in helping to maintain the security of the network.means, that anyone holding BitConnect Coin in their wallet will receive interest on their balance in helping to maintain the security of the network.security of the network.

Proof of Stake allows them to accumulate interest on their pre-mined coins!

Let's assume they kept only 2,000,000 BCC from their pre-mine.

Their current holdings would look like this: 1,543,122 BCC (interest since Jan 2017 until June 2017) + 160,000 (interest since July 2017 till August 2017) = 1,703,122 BCC accumulated in interest since Jan 2017 till today.

In USD, at the current USD / BCC rate, this would be $ 102,187,320. Remember, this is from the interest alone!

Now, let's quickly recall the basic way of how the BitConnect service works.

You give them Bitcoin, take in exchange BCC (their own token), which eventually ... you give them back again (lend).

So ... who in fact holds most of the BCC tokens? And who takes profit from the Proof of Stake? Yup, you got it.

They have a virtually infinite supply of them due to the fact that they have staked millions of BCC, which they are accumulating interest on.

So in essence, the interest they are paying you, do not have their returns from trading, but just the interest they get from their Proof of Stake system!

Just for fun, let's see what their BCC holdings they have to redistribute to their users to keep them happy.

First, we need to make some assumptions because I am unaware of how many users they have and what average amount of Bitcoin their users send them.

I think the following assumptions might be reasonable:

10,000 users, with an average BTC deposit of 0.1.

This means that there are approximately 1,000 BTC in holdings.

For an average user of 0.1 BTC, in 1 month they should be around 0.035 BTC in interest if they're getting 1% per day.

Multiply this by 10,000 users and you get 350 BTC per month, that they need to pay their users ... But they do not pay BTC, they pay them BCC!

So in 1 month they are expected to pay their users approximately 350 BTC * (40 BCC / 1 BTC) = 14,000 BCC per month.

Earlier in this article, I calculate the pre-paid coins.

In this month alone, assuming they staked around 2,000,000 coins, they have accrued about 160,000 coins.

That 14,000 BCC they need to pay their users is a mere afterthought.

Having a look at the richest BCC address, which I think is more than just what you need, and can easily sustain 100,000 users.

You think that's it? Not really, that's just a beginning!

Now, let's assume that Bitconnect suddenly becomes very, very popular.

The number of users grows exponentially and the demand on BCC surpasses the supply.

Also, more people starts to accumulate BCC, to take profit from the Proof or Stake on their own.

You think, that's bath, that's really bad ...

How will Bitconnect pay all those interests ?!

Well, that's the best thing that can happen!

The higher the BCC price!

So now, as they pay the interests in BCC, they have to pay you even less BCC!

They will still pay you money! Is that not ingenious ?!

There is more ...

Proof of stake is not the only source of income for BitConnect

You should remember that BCC is the most available BCC based transactions on their own trading platform!

You trade BCC for BTC and vice versa.

You think, they do it for free? Nobody does!

They get a decent fee from every buyer (0.25% from both buyers and sellers)!

And what if, in addition, do they actually have their brilliant BTC trading bot ?!

Conclusion

Bitconnect is a self-sustaining factory with a license to print digital money, which they gladly share with the community.

Why do they do it?

Because they can; because they earn thanks to you; because they can afford it; because they want to make both them and you happy; because they want to popularize Bitcoin and digital currency in general.

Is it a Ponzi / pyramid scheme?

I do not think so. Why? Because in every single Ponzi / pyramid scheme the math says it does not compute.

Because in every single Ponzi / pyramid scheme the founders run away with your cash after some time.

Does it compute well in case of BitConnect? Yes, it does, and it does compute ingeniously!

Disclaimer:

This is the knowledge we should have invested in a platform before we do, but not only do we investigate and calculate, but then you can come up with your own perspective on the matter.

How long will it last?

No one can give a definite answer to the question, but the idea is that BCC and BTC, I think that Bitcoin itself stays the Bitconnect platform can be sustained.

No one can look into the future so always stay cautious no matter what type of investment you are planning on doing.

Do not play with money, in the end, there is always risk involved.