HitBTC, once the largest external exchange for BitConnect Coin (BCC), halted all BCC trading on February 2, 2018. This action further isolated thousands of investors who lost significant sums in the cryptocurrency Ponzi scheme, cutting off their primary avenue for potential recovery.
BitConnect operated as a lending platform, promising high returns through its proprietary BCC token. The scheme encouraged users to deposit Bitcoin, which was then converted to BCC and "lent" back to the platform for daily interest. This model relied entirely on a constant influx of new investors to pay existing ones.
Before its collapse, over 95% of BCC trades occurred on BitConnect's internal exchange. This system allowed the platform to create the illusion of liquidity. When the scheme unraveled in January 2018, the internal exchange abruptly closed, and administrators vanished with remaining assets.
Desperate investors then moved their remaining BCC holdings to external exchanges. HitBTC quickly became the primary venue, handling more BCC to Bitcoin, USD, and Ethereum trades than all other exchanges combined. This consolidation made HitBTC a critical, if temporary, lifeline for those seeking to divest their tokens.
Citing an "uncertain situation with BCC coin," HitBTC announced it was "temporarily disabling BCC markets." While BCC withdrawals remain possible from user accounts, trading ceased. This leaves only smaller platforms like CoinExchange and Livecoin for any remaining BCC transactions, where volume has dwindled to negligible levels.
The delisting comes as class-action lawsuits against BitConnect founders and promoters gather momentum across various jurisdictions. Federal regulators, including the U.S. Securities and Exchange Commission, have increasingly scrutinized cryptocurrency lending schemes, often classifying them as unregistered securities offerings subject to strict rules.
As BitConnect imploded, a similar operation named DavorCoin emerged, attracting many former BCC investors. DavorCoin mimicked BitConnect's Ponzi lending structure, using its own DAV token. This strategy, known as a "reload scam," targets victims of a prior fraud, hoping to extract more funds from those already financially damaged.
DavorCoin's DAV token quickly followed BCC's trajectory. Once investors realized the pool of new participants was too small to sustain payouts, DAV's value plummeted. It now trades at approximately $5.90, even less than BCC's current $6.34. Efforts to restart investment, such as a "millionaire lending lottery," failed to attract new capital. Daily DAV trading volume dropped below $100,000.
The legal landscape for BitConnect victims remains complex. One such lawsuit, filed in the Southern District of Florida, continues to seek damages for investors defrauded by the BitConnect platform.