SEC is suing five people for advertising BITCONNECT 2B KEELY. This is a security service that is digital which it claims was not registered and was able to raise more than $2B from investors who are retail.
Davor Coin promised its users that if they lent the company money, they’ll offer them 1 million dollars. Davor Coin was initially financed by optimistic investors who poured money into it. However, the following week they received a cease-and-desist note from Texas.
A large number of people borrowed money to purchase cryptocurrency, as the price of the currency increased during the year. Some also invested in lending institutions like Davor Coin which will accept real cash in exchange for “interest” paid in fringe cryptocurrency.
The lending program is viable for as long as the value of cryptocurrency remains on the rise. However, the price of cryptocurrency is falling and lending companies are cutting and running cash, and are being threatened with cease-and-desist orders from the authorities accusing them of securities fraud.
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BITCONNECT 2B KEELY | BITCONNECT FOUNDER INDICTED FOR ALLEGED $2.4 BILLION
Davor Coin was trading at a high level just one week prior to Wednesday’s closing.
“WELCOME to the “BE A MILLIONAIRE” LENDING Lottery! The company announced in a Medium post, “WELCOME TO THE ‘BE A MILLIONAIRE’ LENDING LOTTERY!” “We are offering an unbelievable $1,000,000 to a member of the Davor community as well as many other prizes!”
All that was needed to give Davor Coin cash was the customer. Even if the customers didn’t get the million-dollar jackpot Davor coin Davor coin promised massive returns on loans made through the cryptocurrency it owns.
Although the purchase may be risky for prospective customers, Davor Coin found it to be a lucrative investment. According to an unconfirmed study, those who purchase bitcoin are comfortable registering in credit programs that deal with this digital currency. They believe that the currency will grow in value.
In a December poll, 18 percent of those who participated said they borrowed money to purchase bitcoin. 22 % of Bitcoin purchasers who borrowed money to buy bitcoin informed LendEDU that they had not been able to pay off the debt. More than 70% of Bitcoin enthusiasts who haven’t paid off their debts with bitcoin have said they are in agreement with the assertion “I think owning Bitcoin is worth the interest expense.”
Discussions are frequent in cryptocurrency forums. For instance, this thread has a user that says he took out an auto title loan from his Honda to purchase cryptocurrency. The cryptocurrency will rise in value until he’s in a position to purchase an expensive Lamborghini. Businesses, such as Shift cash, promote auto title loans based on crypto.
“More than 70% agreed with the statement that ‘I believe owning Bitcoin worth the interest expense’.”
It’s an opportunity for buyers people who would like to spend on digital currency, even if they’re worthless the next week.
Davor coin also provided another reason to believe in the Davor coin. In the weeks leading up to when Davor coin announced its million-dollar prize, the company was closed.
Bitconnect is a company that lends crypto that is long-time accused of being a shady Ponzi scheme. The company’s aggressive marketing campaign enticed customers and other customers to join the service. The management of the company was totally in the dark. The experts were skeptical of their claims of a one percent daily return however, they were totally untraceable.
Investors continue to loan Bitconnect money despite warnings. In January officials from the Texas State Securities Board, and the North Carolina secretary-of-state sent cease-and-desist letters to Bitconnect and Bitconnect, accusing them of financing fraud in the securities market. Bitconnect announced its shutdown on the 16th of January. It blamed “the continued bad press made community members uncomfortable.”
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Bitconnect’s cryptocurrency fell to the floor. This led to individuals such as this Reddit user who claimed that he took out a $500,000 credit for his company and later transferred it to the defunct cryptocurrency company.
Instead of being worried about the loss of Bitconnect, the identical Davor coins were praised. Davor Coin expressed its displeasure over Bitconnect’s demise by writing “This doesn’t change anything for us.” Davor Coin was just becoming the “largest lending platform in all of the world!”
These claims attracted the interest of Texas police, who issued a cease and desist to Bitconnect. Texas issued Davor Coin a cease-and expiration date of February. 2 informing it not to sell its services in Texas until it has been officially registered as a securities firm.
Five days later, Davor Coin made the announcement that it would be closing its loan service. Customers were left with nothing other than Davor Coin’s cryptocurrency, which was owned by the largely dead business. The price plummeted from its high price of $177 to less than a cent per coin.
Facebook became the primary platform buyers were able to discuss their losses. The one who borrowed $4,000 from the company and was left with just the sum of $9. Another complained that he gave Davor Coin $20,000 and received $23.50 when he tried to pay it off.
While swindled investors lamented their losses on Twitter, other cryptocurrency firms were quick to fill in the gap.
“Good announcement for your guys,” one Twitter user who didn’t have a profile picture posted a tweet to a lot of people who were angry over the loss of cash to Davor. “Good announcement” was an advert for a new lending company for cryptocurrency that is scheduled to launch next Saturday.