BitConnect Has Shut Down Almost All Operations
The Unexpected Shutdown of Bitconnect Has Caused the BCC Token Price to Tumble
Bitconnect, the company behind the controversial BCC crypto coin, has formerly announced that it has shut down operations. This will cover the cryptocurrency exchange it runs, and all lending operations. The message was posted on its website. Following this move, the BCC cryptocoin dropped in price to trade at about $30, from about $400 at the start of the day.
What Will Remain Open?
Bitconnect may have shut down most of its core services, but some will continue to run. The exchange services will shut down after five days, giving investors ample time to pull out their cryptocoins. However, the website will remain active, and the founders of the company will continue to use it to spread news regarding the cryptocoin world and educate the masses. Also, the wallet service will remain open.
Why the Shutdown
According to the statement released by Bitconnect, there were three main reasons why they decided to shut down. One of the reasons was warnings from regulators in two states. Security authorities in Texas issued a cease and desist notice at the start of this month. They accused the company of fraud for failing to state their principals. They also failed to state where they would get money to pay investors “an interest of 120%” annually. Soon after, the state of Carolina ordered Bitconnect to cease all operations in the state.
Following these two warnings, Bitconnect said,
These actions have become a hindrance for the legal continuation of the platform.
Secondly, the platform said that they had come under DDoS attacks in recent days. This had made the platform unstable, which had led to panic within the community. Thirdly, they blamed the bad press they had been getting for this decision. They received a lot of negative criticism from leading figures in the cryptocoin community. For instance, Charlie Lee, the creator of Litecoin, said that the BitConnect “seems like a classic Ponzi scheme”. The founder of Ethereum had previously aired similar sentiments. In such an environment, BitConnect said that it was very hard for them to remain operational.
Despite the decision to shut down the operation of its exchange, the company insists that it will continue to support its digital token. They insisted that the BitConnect X ICO was still very much in force and would proceed. They even pinpointed an upcoming exchange that was going to list BCC.
They insisted that closing their lending and exchange services did not mark the end of their community. However, for now, the prevailing conditions did not allow them to continue offering all the services that they had previously offered.
What do you think about the decision by BitConnect? Could regulatory pressure force other exchanges to close up shop in future too? Leave us your thoughts in the comment section below.