The digital currency known as Bitcoin is gaining popularity but some websites which promise huge return in investments are causing concern.
The I-Team is taking a closer look at one of those websites and what you need to know if you’re thinking of dabbling in digital currency.
Bitconnect claims to be a money maker for its users. A self-regulated financial system where investors can earn profits through the digital currency Bitcoin. Think virtual money and a company’s underlying promise to get rich quick from it.
“If it does succeed and it does go at least a year or two, I’ll be set. You know, my whole family will be set,” said Christopher Mason, Bitconnect user.
He says he put a $1,000 into Bitconnect a few months ago.
Mason claims it nearly doubled a couple of months later through interest paid daily and bonuses for getting other people to sign up which he is doing on social media.
However, he’s not worried.
“There’s always that you know, but you know, sometimes you just gotta grab life by the horns and when you see something that’s proven itself and there’s really no reason to doubt it.”
The I-Team tried to reach Bitconnect but was unsuccessful. Despite support on social media and extravagant presentations, it’s unclear who owns the website. In hopes of getting some answers, the I-Team went to a Bitcoin conference in Las Vegas.
“You’ll look over here at the 50 exhibitors we have, not a single one of them is saying, you can go and make 10 times, 20 times your money,” said CEO Michael Terpin, Transform Group.
He runs a marketing firm in the Bitcoin industry and organized the event.
“Most things that promise you return in a market. Nobody can you promise you return. There’s always risk, that you have to disclose risk. Anybody that promises you return is most likely a ponzi scheme,” Terpin said.
Shawn Owens runs SALT, a lending platform in the Bitcoin industry.
“It’s been the best thing that’s happened in my life,” he said. “It’s been the best investment I’ve made.”
Owens says when he first learned about Bitcoin in 2010, its value was around 30 cents. There’s a total of only 21 million Bitcoin in existence and demand is rising. Now, that 30-cent Bitcoin is worth more than $6,000.
“For myself personally, I wouldn’t buy it. It tends to be a more speculative investment,” said Stephen Miller, UNLV.
Miller is the director of the Center for Business and Economic Research at UNLV.
“One of the attractions of Bitcoin is that it’s not controlled by government and for some people that is an attractive features. On the other hand, if it’s not controlled by government, then it’s also open to corruption and abuse and manipulation,” Miller said.
“There’s still always this human element which is people try to do bad things when they think they can get away with it and this is gonna be no different,” Owens said.
Mason just wants a piece of the pie, but it’s unclear if he went to the right place for it. He knows he could lose all of his money but he thinks the rewards are greater than the risks.
He did lose money through another website that turned out to be a scam and he had recruited others for that one, so he also lost Facebook friends, as a result.
The bottom line — do your research before you invest in anything.