USI-tech, a bitcoin mining company that has its headquarters in the United Arab Emirates, has promised to return and reopen its services for North American customers, according to a statement provided by them on their website.
The company has had prior regulatory issues in Texas, Washington, Minnesota and Hawaii, because the company’s compensation structure and marketing approaches were very questionable. As a consequence, USI decided to halt its services for North American Customers until further notice.
Company president Horst Jicha is keeping the promise he made in an interview six days ago about continuing to work with the USI legal team to allow North Americans the opportunity to withdraw their funds or continue to earn a daily return of 1% on their investments.
Bitconnect and its similar situation
Bitconnect was investigated by the Securities Exchange Commission (SEC), based on the allegations that the company was operating as pyramid which had raised through illegitimate means the value of the company’s BCC token to over $4.1 billion USD.
After this, the company received a cease and desist order, causing it to close its services. As a result, the price of the BCC token crashed from over $435 to under $6 in less than a month.
How to spot other Ponzi schemes
Companies like USI and Bitconnect that sound too good to be true, and are eventually proven to be Ponzi schemes lurk all over the internet. Here is how to identify them and avoid having your hard-earned currencies taken away from you:
- Websites have poorly written text that is littered with grammatical and basic spelling errors due to the companies being understaffed.
- They guarantee high-yield returns on investments.
- Commissions give out constantly for bringing in new users.
- Asking cryptocurrency in exchange for fiat currency, which can only be purchased through the company’s tokens. This will lead to an increase in the price of the new token, which will inevitable crash when authorities intervene.
- Forced re-purchasing.
What will happen next?
It seems that USI wants to learn from Bitconnect’s mistakes and have another attempt at promoting their business on North American territory.
While the company has listed its good intentions, they have not explained how they will comply to SEC rules if their affiliates continue to promote the company while they do not have in-depth knowledge of these rules.
If they will be successful in earing commissions and eventually making their revenue by withdrawing bitcoin into private wallets remains to be seen.