Following months of bad press and increased scrutiny from securities regulators, cryptocurrency lending and exchange platform BitConnect abruptly shut down its operations on the morning of January 17, 2018. Silver Miller (www.SilverMillerLaw.com) -- the leading cryptocurrency investor law firm in the country, with actions already pending against the Coinbase, Kraken, and Cryptsy exchanges as well as class action lawsuits against Initial Coin Offering (ICO) promoters Tezos and Monkey Capital -- has filed, on behalf of investors, a class action lawsuit in federal court against BitConnect and its U.S.-based Directors and promoters.
According to a release on BitConnect’s website, the company blamed the shutdown on “continued bad press” surrounding the platform, two “Cease and Desist” letters from securities regulators in Texas and North Carolina, and multiple DDoS attacks on the website. As alleged in the lawsuit, however, BitConnect’s cryptocurrency lending program bears all of the hallmarks of a Ponzi scheme that required customers to purchase BitConnect’s own native coin (BCC) in exchange for returns purported to be as large as 40% per month. Within moments of BitConnect’s notice, the price of BCC plummeted nearly 90% in value; and the token is believed to be effectively useless now. Moreover, securities regulators in growing numbers had concluded -- consistent with the claims asserted in several lawsuits filed by Silver Miller -- that BitConnect investments are unregistered “securities,” which are illegal to be offered for purchase.
In the wake of the news of BitConnect’s closure, every major cryptocurrency was reported to have fallen in value by anywhere from 15 to 28 percent within a 24-hour period -- a total estimated to be a collective $108 billion for the top ten cryptocurrencies in the world. Investors worldwide are worried about their crypto holdings and fear that additional losses are imminent. If you have invested in an ICO or lost money at an exchange, Silver Miller can help.
BitConnect, Monkey Capital, and Tezos investors concerned about their investments are urged to contact Silver Miller at 954-516-6000 or DSilver@SilverMillerLaw.com. If you are concerned that your investment in an ICO or your holdings at any cryptocurrency exchange are in jeopardy, or you fear that you have been defrauded, please fill out the Confidential Free Consultation form on this page for a no-cost, no-obligation consultation to discuss your legal rights.