Bitbns fixed income plan - quite similar to ponzi!

[avikz]

I was watching India Pakistan match yesterday evening and what surprised me is the number of bitcoin related ads that came in between. It's either Coinswitch, Bitbns, CoinCDX that kept on coming constantly at each interval.

However, what's shocking is the bitbns ad where they spoke about bitcoin FD which gives 4 times more return than traditional FDs. I found this link in their website,

https://bitbns.com/trade/#/fip?utm_source=bitbns&utm_medium=web_footer

I am not sure how they are running this but such kind of deposit schemes come under "Collective Investment Scheme" regulation of SEBI and very similar to ponzis.

What do you think? Is it good to invest in such scheme?

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[pakhitheboss]

I was watching India Pakistan match yesterday evening and what surprised me is the number of bitcoin related ads that came in between. It's either Coinswitch, Bitbns, CoinCDX that kept on coming constantly at each interval.

However, what's shocking is the bitbns ad where they spoke about bitcoin FD which gives 4 times more return than traditional FDs. I found this link in their website,

https://bitbns.com/trade/#/fip?utm_source=bitbns&utm_medium=web_footer

I am not sure how they are running this but such kind of deposit schemes come under "Collective Investment Scheme" regulation of SEBI and very similar to ponzis.

What do you think? Is it good to invest in such scheme?

Everything that Bitbns does is questionable? I had checked those plans long back but did not find anything interesting. There are other platforms from where you can earn more yield and are more trustworthy.

All these ads of cryptocurrency exchanges have one thing in common they are portraying themselves as a better option than MF or Stock market. That is concerning for me as Indians have the habit of saving their hard-earned money and if someone invests his or her money into crypto and if the market crashes like in 2018 then these investors will be on the road demanding justice.

[avikz]

Bitbns offering bitcoin fixed deposits is not a problem till the time they pay back to the people. The problem will start if by any chance Bitbns defaults. A massive outrage will start with a narrative on how bitcoin is a scam. Media and politicians will try to deframe bitcoin rather than the company. Unfortunately, this is how it always happens in India. That's what I am worried about. This will give our Finance minister another chance to bring in a ban.

[teosanru]

Exactly my point! Forget about SEBI it might not intervene as this isn't a listed company, RBI would be the first one to intervene, For any company to accept term deposits from people you have to be registered with RBI as "Deposit Taking NBFC" or as a "payments Bank", unless you take this license you cannot accept term deposits from the general public and Bitbns is doing exactly the opposite. They are actually following the fixed income model created by Binance based on lending and borrowing. But as per Indian laws, this is an absolute unlawful thing because no matter what are you accepting deposits for in the end you are keeping people's money.

Moreover, unless they are creating a lending platform side by side there is a high chance that this plan could backfire, until we are bullish they will happily pay these FDs but once we become bearish these could become a heavy burden on the company and could ultimately lead to losses for customers. This would spoil the name of the whole crypto community.

[pakhitheboss]

Exactly my point! Forget about SEBI it might not intervene as this isn't a listed company, RBI would be the first one to intervene, For any company to accept term deposits from people you have to be registered with RBI as "Deposit Taking NBFC" or as a "payments Bank", unless you take this license you cannot accept term deposits from the general public and Bitbns is doing exactly the opposite. They are actually following the fixed income model created by Binance based on lending and borrowing. But as per Indian laws, this is an absolute unlawful thing because no matter what are you accepting deposits for in the end you are keeping people's money.

Moreover, unless they are creating a lending platform side by side there is a high chance that this plan could backfire, until we are bullish they will happily pay these FDs but once we become bearish these could become a heavy burden on the company and could ultimately lead to losses for customers. This would spoil the name of the whole crypto community.

I am seeing the future here, something bad is going to happen with all these shit adverts coming out on national television. All of them are giving fake hope and if one of them defaults then we will again see dharna on national television against Bitcoin and cryptocurrency as a whole. They are promoting senseless products, just tell me who needs a SIP or Fixed deposit of BITCOIN?

[teosanru]

Exactly my point! Forget about SEBI it might not intervene as this isn't a listed company, RBI would be the first one to intervene, For any company to accept term deposits from people you have to be registered with RBI as "Deposit Taking NBFC" or as a "payments Bank", unless you take this license you cannot accept term deposits from the general public and Bitbns is doing exactly the opposite. They are actually following the fixed income model created by Binance based on lending and borrowing. But as per Indian laws, this is an absolute unlawful thing because no matter what are you accepting deposits for in the end you are keeping people's money.

Moreover, unless they are creating a lending platform side by side there is a high chance that this plan could backfire, until we are bullish they will happily pay these FDs but once we become bearish these could become a heavy burden on the company and could ultimately lead to losses for customers. This would spoil the name of the whole crypto community.

I am seeing the future here, something bad is going to happen with all these shit adverts coming out on national television. All of them are giving fake hope and if one of them defaults then we will again see dharna on national television against Bitcoin and cryptocurrency as a whole. They are promoting senseless products, just tell me who needs a SIP or Fixed deposit of BITCOIN?

Very true, Indian media just needs an excuse to create controversies and if such a thing happens I am very sure cryptocurrencies' future in India would be pretty much doomed. Talking about these products, the thing is that all these exchanges want to showcase bitcoin and cryptocurrencies as a safe investment to attract more and more users on their platform and we know how heavy a fight is going on between, WazirX vs CoinDcx vs Coinswitch, in this fight BitBns despite being early mover was lagging due to lack of advertisement so it finally decided to come with this unique but foolish idea.

[pakhitheboss]

Exactly my point! Forget about SEBI it might not intervene as this isn't a listed company, RBI would be the first one to intervene, For any company to accept term deposits from people you have to be registered with RBI as "Deposit Taking NBFC" or as a "payments Bank", unless you take this license you cannot accept term deposits from the general public and Bitbns is doing exactly the opposite. They are actually following the fixed income model created by Binance based on lending and borrowing. But as per Indian laws, this is an absolute unlawful thing because no matter what are you accepting deposits for in the end you are keeping people's money.

Moreover, unless they are creating a lending platform side by side there is a high chance that this plan could backfire, until we are bullish they will happily pay these FDs but once we become bearish these could become a heavy burden on the company and could ultimately lead to losses for customers. This would spoil the name of the whole crypto community.

I am seeing the future here, something bad is going to happen with all these shit adverts coming out on national television. All of them are giving fake hope and if one of them defaults then we will again see dharna on national television against Bitcoin and cryptocurrency as a whole. They are promoting senseless products, just tell me who needs a SIP or Fixed deposit of BITCOIN?

Very true, Indian media just needs an excuse to create controversies and if such a thing happens I am very sure cryptocurrencies' future in India would be pretty much doomed. Talking about these products, the thing is that all these exchanges want to showcase bitcoin and cryptocurrencies as a safe investment to attract more and more users on their platform and we know how heavy a fight is going on between, WazirX vs CoinDcx vs Coinswitch, in this fight BitBns despite being early mover was lagging due to lack of advertisement so it finally decided to come with this unique but foolish idea.

For a little bit of profit, they will destroy their own business. This is why the government should come up with regulations in this field. There should be some law that prohibits these exchanges from advertising false hope to the consumer. Almost everyone would fall for this trap and lose money.

[avikz]

Regulation is very much expected in the crypto space considering how crypto exchanges in India are actively campaigning to bring in favorable regulations. However, with such CIS schemes running by bitbns, may actually make the regulatory bodies negative about it.

Collective Investment Schemes are not specifically banned in India. But we have seen SEBI stepped in in the past to discourage people from such schemes. Let's see what happens!

[pawanjain]

You guys are talking about fixed term deposits and regulations on it and it's true that people will panic if they don't get the interests on time regularly but you are forgetting one thing.
It's not really about the term deposits at all. It's about cryptocurrency as a whole. People will panic and defame cryptocurrencies because of these websites.
Many people already defame cryptocurrencies because of their own mistakes which lead to scam, hack and theft.
While there are such kind of people it will be really easy for people who have invested in such websites which can't pay their users back.

P.S : Thank god bitconnect is not operating currently.

[libert19]

Colodax gives 12% on inr holdings and coindcx 13-14% on usdt (there are others too but usdt gives most), they are registered as company but idk if they are allowed to give interest? Can anyone throw some light on same?

[teosanru]

Colodax gives 12% on inr holdings and coindcx 13-14% on usdt (there are others too but usdt gives most), they are registered as company but idk if they are allowed to give interest? Can anyone throw some light on same?

The Law is that a company has to be register as a Deposit taking NBFC with RBI to accept term deposits from general public, apart from registration it also has to comply with all the conditions as mentioned in the law as well as guidelines issues by RBI, apart from these comapnies, no one is allowed to take term deposits from general public. Also because these exchanges don't publicly disclose where are they routing the funds of these fellow investors, so things become even more sceptical.

[libert19]

Colodax gives 12% on inr holdings and coindcx 13-14% on usdt (there are others too but usdt gives most), they are registered as company but idk if they are allowed to give interest? Can anyone throw some light on same?

The Law is that a company has to be register as a Deposit taking NBFC with RBI to accept term deposits from general public, apart from registration it also has to comply with all the conditions as mentioned in the law as well as guidelines issues by RBI, apart from these comapnies, no one is allowed to take term deposits from general public. Also because these exchanges don't publicly disclose where are they routing the funds of these fellow investors, so things become even more sceptical.

Assume worst case scenario, exchange runs away with your money, what customer can do?

[pakhitheboss]

Regulation is very much expected in the crypto space considering how crypto exchanges in India are actively campaigning to bring in favorable regulations. However, with such CIS schemes running by bitbns, may actually make the regulatory bodies negative about it.

Collective Investment Schemes are not specifically banned in India. But we have seen SEBI stepped in in the past to discourage people from such schemes. Let's see what happens!

SEBI, RBI are all regulatory bodies that are under the control of the government of India. They will only react when the government wants them to react. At the moment the government itself is clueless about crypto. They themselves have no idea on how to implement regulations and I also feel that they want a big scam to happen, which will make them easier to ban it. 

[teosanru]

Colodax gives 12% on inr holdings and coindcx 13-14% on usdt (there are others too but usdt gives most), they are registered as company but idk if they are allowed to give interest? Can anyone throw some light on same?

The Law is that a company has to be register as a Deposit taking NBFC with RBI to accept term deposits from general public, apart from registration it also has to comply with all the conditions as mentioned in the law as well as guidelines issues by RBI, apart from these comapnies, no one is allowed to take term deposits from general public. Also because these exchanges don't publicly disclose where are they routing the funds of these fellow investors, so things become even more sceptical.

Assume worst case scenario, exchange runs away with your money, what customer can do?

The Best case scenario in this worst-case scenario for customers is that they file a complaint to the police, Some courts would pick up the case and would order the Exchange to pay off the money to customers, if they fail to do so, they will be declared insolvent and their remaining assets will be distributed pro rata amongst the remaining customers, not to forget that the owners personally would be charged to a penalty for deceiving customers into false claims and operating without a license in the country. Apart from this, there is no remedy customers have, obviously courts are slow and this process might take months, if not years.

But yes I'll be very honest, even if an exchange runs away with your crypto investment, the scenario and remedies available to you are still going to be the same. So technically you as a customer are at an equivalent risk when buying any product from this exchange.

[gupshupblog]

I wouldn't trust Bitbns, but the same offerings are there in Binance "Earn" segments, so you can move your holdings there and earn interest.

You're seeing so many ads because there's a saying in Hindi "Paisa Bolta hai" 
All the crypto exchanges in India have heavily invested in all ads including TV ads so that people become more aware of Crypto, but in the longer run, whether these exchanges will be allowed to operate in India is questionable.