What is Phishing and How to Detect It

What is Phishing?

Phishing is an attempt to steal your identity.  Some of our users have received e-mail that appears to be from BTCJam, but is really designed to trick them into revealing private information. This type of scam is called “phishing”. Under false pretenses, criminals try to get you to disclose sensitive personal information, such as credit and debit card numbers, account passwords, or Social Security numbers.

– These emails may be sent to thousands, usually at random, and appear to be messages from well-known companies.

– The phishing email contains links or buttons that take you to a fraudulent website.

– The fraudulent website typically mimics the company referenced in the email, and aims to extract your sensitive personal data.

Email addresses can be obtained by these criminals from many places on the Internet. Lists of emails may be purchased, or even guessed, If you receive a fraudulent email that appears to be from BTCJam, this does not mean that BTCJam’s computer systems have been breached.

Never open attachments, click links, or respond to emails from suspicious or unknown senders. If you receive a suspicious email that appears to be from BTCJam, report it and delete it.

How to Spot a Fake Email

  1. The sender’s address may include a seemingly official address that mimics a genuine one. It is easy to alter the sender’s email address so do not initially trust it.
  2. Typos and poor grammar are common from fraudsters, and not because they do not know how spell – it is so the phish will not be blocked by email filters.
  3. The fraudster will try to instill a false sense of urgency that usually tells you to check your account right away or something critical will happen if you do not give the information.
  4. These emails will include fake links that lead to other sites. Please hover over the link before clicking it to check if the URL leads to BTCJam.

At BTCJam, protecting our members is a top priority. Remember to report a suspicious or fraudulent email to support@btcjam.com

Introducing NAR: A Useful Tool for Successful Investors

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What is Net Annualized Return?

NAR (Net Annualized Return) is the measurement of the performance of your total investment on BTCJam. It reflects the funds actually received each month.

You can now view your NAR of all your investments on BTCJam in your Investments page.

What makes NAR useful as an investor?

As an investor, you need to eat, sleep, and breathe NAR. (Also, expected APR – see more here).

If you were a painter, the paint would be your invested bitcoins, the brush would be BTCJam, and the NAR would be the painting. NAR is the most accurate measurement to monitor how you have grown your bitcoins on BTCJam.

How does BTCJam calculate NAR?

To calculate NAR, the numerator is composed of interest received, plus late fees received, minus the amount in default. The result is divided by the total mature principal. The mature principal is the investment that has already a related payment or default.

For notes, your notes sold also affect your returns both positively and negatively. If you sold a note for 1, but invested 1.2, you will have a -0.2 loss. If you bought a note for 0.1 and received 0.4 in payments you will have 0.3 in gains

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This is a live calculation so every event that can change it is automatically performed.

BTCJam started using this calculation from April 1st, 2014, so this only reflects your return starting with funds invested on or after April 1st, 2014.

Get g’nar’ly,  and start investing today.

What Bitcoin Means For Peer-to-Peer Lending

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Endophytic fungi are primarily an altruistic fungi that partner with many plants–from grasses to trees. Their mycelia, the vegetative part of fungi that look like a network of threads and are vital to both aquatic and terrestrial ecosystems for their role of decomposition, weave through plant’s cell walls but do not enter. The mycelia enhances the plant’s growth and ability to absorb nutrients, while starving off parasites, infections, and predation from insects, other fungi, and herbivores.

In this same way, Bitcoin, an autonomous, decentralized payment system, entwines and connects people from around the world while improving the mode of transaction in an efficient and fast way despite where the sender and receiver are located. At the same time, it renders traditional modes of transacting as antiquated and unfit for the modern world. Bitcoin protects from ill-intended third-parties and negligent intermediaries; you can store your Bitcoins so only you have access, take an unlimited amount across borders, and send/receive with anyone anywhere around the world.

Bitcoin has weaved itself through many different industries, a profusion of people, and has fostered not only a sense of community, but also, a growing force of change and equality amongst its’ users.

When Bitcoin is incorporated with peer-to-peer lending, it accentuates and globalizes all of the benefits that lending and borrowing on a peer-to-peer network has to offer. That is customizable terms, easy application, lower interest rates, and faster funding rates for borrowers. Investors can spread risk, receive higher returns, and have the power to choose who they want to invest in.

Like how endophytic fungi on cocao tree leaves decrease leaf necrosis and mortality by a threefold, users on a P2P lending platform powered by Bitcoin will inherently be immune to the aches and pains that are structural of the orthdox payment and lending systems of today.

Typical payday loan providers charge $17.50 for every $100 your borrow, with late fees of the same rate for every full term period you are overdue, you could quickly find yourself in debt. (1) BTCJam, the first peer-to-peer lending platform using Bitcoin, allows borrowers to set their own interest rates that cater to them. Investors will then review the loans and decide if they want to invest or not.

The speed of funding on BTCJam is at an average of 6 days. This is due to the network of lenders based around the world using the decentralized, peer-to-peer cryptocurrency! The archetypal structure this follows resembles that of mycelia, the web-like Internet, neurological arrays in the mammalian brain, and so on. The advantage of P2P Bitcoin lending platforms is an inevtiable consequence of previously proven evolutionary models.

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The Milky Way also follows this archetype.

image– Alexis Aiono

Late Fee Updated

For a long time, our fee for late payments was the higher of 0.15 BTC or 5% of the missed payment for borrowers. This was set when the bitcoin price was much lower and this started to be a high fee, especially for small loans. In order to make life easier for borrowers (and encourage even more borrowers to join the around 90% of borrowers who repay on time) we have changed the late fee to be as follows:

The maximum of 5% of the missed payment and the $15.00 equivalent in Bitcoin.

A Response to Simon’s Open Letter

Dear Simon,

We would like to thank you for being an active member of our community and for taking the time and to write an open letter to us that you have clearly put your heart into.

We are very grateful for all of our investor’s support and everybody who’s been with us this entire time. The platform is growing rapidly: we are now close to 20,000 users, have made loans over 23,000 BTC, and have a credit scoring algorithm that helps investors realize fantastic, 19% year over year returns on average.

BTCJam has a vision that is huge. We try to build an open platform for everybody to lend and borrow with no borders, limits, minimums, restrictions or minimal fees.

A very large part of this vision is due to our lenders who not only make this vision a possibility, but also provide us with feedback to improve or change. BTCJam is a business with limited resources so we have to be extremely careful and smart about how we spend our resources on further developing the platform.

Our investors are one part of BTCJam, and we dedicate our time to each part in order to maintain growth and stability within the platform.

One thing that has been a contstant learning experience for us is to balance transparency vs. privacy. In other words, to decide how much to show about borrowers or investors as to increase trust amongst everybody while also protecting your individual right to privacy.

Let me address your points below to give you an idea:

  • Don’t make money from scammers. Take your cut from loan repayments, not at the time a loan is funded.

We are a company that needs to pay employees, servers and other fees. We incur these expenses whether we have a month with particularly good repayment rates or not. We are not a charity and we want to survive. We are sure that this is in the long-term interest of everybody involved in our company. On top of that, our current repayment rates are around 90% – so this only affects a small amount of loans. Other businesses in the space have a similar origination fee model.

  • Provide information on how much of a loan has been repaid

While this is currently reflected in the credit score, we are evaluating if and how we can show this on the site.

  • Provide information on how much debt a borrower is in, when they are taking out a new loan

see above

  • Incentivize borrowers to repay their loans before taking out new ones

Borrowers with a lot of outstanding loans will feel the impact on the credit score. As an open platform, we want people to be able to weather difficult financial conditions, which sometimes require several loans. We believe that a low credit score and higher suggested interest rates are strong incentives for people to pay back their existing loans quickly.

  • Show a borrower’s bitcointalk and otc-wot links publicly

Not all borrowers would like the public to know that they are in financial need.

  • Allow borrowers to show their linkedin and facebook profile links publicly if they so choose, to improve the trust of their investors

We also do not want to put the borrowers who are not willing to share their identity with the whole world at a disadvantage with the ones who are. The credit score reflects the risk and can be trusted quite well – which we are seeing with our 90% repayment rates.

  • Show how much collateral (bitcoin) a user has invested in the site, and how much they have yet to recieve, so that investors can see they have a vested interest in the community

We think it is very risky for users to borrow and invest at the same time. What if the investments they made default? Suddenly they have an excuse to not pay back their own loan. This can lead to a domino effect that we want to prevent as much as possible.

  • Engage with the community. Ask investors what they would like to see in your product, and implement what they ask for.

We are listening very actively to our user voice, our facebook pages, reddit, bitcointalk, twitter, and other sites where people are engaged with us.

I hope this answer explains that we can’t in every instance fullfil our users needs right away.

As said, we need to balance the wishes of investors with the immediate and long term needs of BTCJam as a business that seeks to provide low interest loans and fantastic returns to millions of people around the globe.

Celso and the BTCJam Team

Introducing APR, Expected Loss, and Expected APR

We are very proud to introduce an important new feature for investors: Expected APR. With this new feature, you will be able to have a better estimate of how much you will earn with your investment. In the browse listings page, you can now filter by the expected APR, and on the specific listing page you can view the effective APR and estimated loss.

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What is APR?

APR (Annual Percentage Rate) tells you how much your bitcoin will grow at an annualized rate when invested in a loan. For a 1 month loan, imagine re-investing the Bitcoin you got back in another loan with the exact same terms 12x over the period of 1 year. It is a standardized computation that provides the bottom-line number that reflects how much an Investor can gain.

What is Expected Loss?
BTCJam calculates the probability of loss determined by historical repayment rates, the borrowers information, and repayment behavior on BTCJam.

What is Expected APR?
APR – Expected Loss = Expected APR
This calculation is the expected gain determined by the APR minus the Expected Loss. This is the estimate of how much you will gain.

For example, a loan of a $100 has:

APR: 8.20%

Expected Loss: 0.11%

Expected APR: 8.09%

And you invested the Bitcoin equivalent of $10.

The APR is 8.20% so you could grow your bitcoins to the equivalent of $10.82 with an Expected Loss of $0.01.

If you invest a total amount of $10,000 with each invesement at $10 in 1000 of loans with those exact numbers, it is expected that 1 defaults (1000×0.11 ≈ 1), so you lose 1 and 999 loans grow with 8.2% a year. 999x10x1.082 = $10,809.18.

Now, your effective return is ($10,809.18-$10,000)/$10,000 = 8.09% which matches your expected APR. Be aware that the expected APR is based on the historical performance of BTCJam’s repayment rates and that your actual performance may vary.

Remember, having a diversified portfolio significantly lowers the risk of your investments! Learn more about diversifying here.

Excited? Check our newest listings!

Announcing BTCJam’s Referral Program!

Do you want to earn up to $20 worth of bitcoin per referral?

Then join BTCJam’s referral program! Post the referral link on your Facebook, post it on your blog, e-mail it to your friends, family, and ex-girlfriends – we don’t judge!

You will receive the award when they create a new account and take out a loan or make an investment.

To receive the award you both need to have your identity 100% verified, and have a social media account (Facebook or Linkedin) connected.

Award Type: Investor 

Description: You will both receive $5 in Bitcoin once the new user has more than $100 worth of investments in activated listings.

Award Type: Borrower Level One

Description: You will both receive $5 in Bitcoin once they have borrowed at least $250.

Award Type: Borrower Level Two 

Description: You will both receive $15 in Bitcoin once at least $250 worth of loans has been repaid.

Exsisting users, share the love and get your free bitcoin now!

New users, get started and start referring to get your free bitcoin!

Peer-to-Peer Lending Will Change Developing Countries

Scenario: You are a middle-aged labor worker in Sao Paulo, Brazil making minimum wage which is about $310 a month. Your wife has just given birth to your second child meanwhile living expenses have been depleted and you are in debt with one of your two credit cards from paying for medical operation and basic needs. You are faced with paying almost 200% APR on this debt, and your loan application to banks have been denied because of your negative credit rating.

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Unfortunately this is common situation in many developing countries. Hard-working individuals are financially trapped, tricked into accumulating more debt by payday loan providers, and they rarely triumph over these barriers, which prevent them from living a stable life.

People in Developing Countries need of solution that will:

  • Provide reasonable, equal opportunity interest rates
  • Have an easy application
  • Use a payment protocol that can transcend borders
  • Be transparent and efficient
  • Empower the individual

This is what peer-to-peer to lending powered by Bitcoin does.

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Taking out a loan on BTCJam is as easy as a few clicks; simply submit your identity documents to prove you are a real person. When creating a loan, you are given a suggested interest rate determined by the credit scoring algorithm; however, you may choose whichever rate works best for you. This effective and labor-saving process permits anyone to get a loan from the comfort of their own home regardless of origin, financial history, and state determined credit rating. Anyone with internet access has the opportunity to get a loan without going through unnecessary intermediaries.

With peer-to-peer lending using Bitcoin, entrepreneurs from developing countries are able to take out loans that they would not otherwise have access to and put the funds towards their ventures. For example, Gaston Azzollini, an Argentine borrower on BTCJam’s platform, has taken out a series of loans to put towards his various businesses in Villa Carlos Paz, Argentina. One of them is the restaurant Lo De Elvio where all BTCJammers are welcome to dine at a discounted rate.

Economies of local communities are being funded on a macro-level because of Bitcoin. BTCJam’s peer-to-peer lending platform is helping to strengthen the economies of developing countries while providing 24/7 nondiscriminatory access for consumer loans.

Plant your seed of Bitcoin today.

Photos of Gaston and his restraunt Lo De Elvio in Villa Carlos Paz, Argentina

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10 Tips to Get Out of Debt

Spend less, save more. It’s the third most-common New Year’s resolution for a reason — millions of people around the world struggle with debt, but few know how to chip away at the credit card bills, car loans and other expenses that can leave you feeling overwhelmed. It is possible to dig yourself out from under what can seem like a mountain of debt using a few easy-to-incorporate strategies.

Get organized

#1 Make a list

Trying to deal with a lot of miscellaneous bills can make paying down debt a nightmare. The first step toward repayment is to get organized so you have a clear picture of where you stand. Make a list of exactly what you owe and to whom. By facing the facts and laying everything on the table, you are more likely to have a realistic idea of your situation and a better chance of making progress.

#2 Make a budget

Make a budget and stick to it! This is difficult for a lot of people — hence those broken New Year’s resolutions. Try a web service like Mint.com or BudgetTracker.com to help you organize your budget, and be honest about what you put down. Try to stick to it and see how good it feels to stay within your means each month.

#3: Refinance your debt

Try refinancing your credit card or other debt. You can apply for a personal loan that may have a much lower APR than many high-interest cards, and using this money to pay off credit debt can save you money on interest payments in the long run.

#4 Organize your spending

Categorize your spending. Organize things into must-have, should-have, and like-to-have. If you can do without something, you can put it on the “like to have” list and avoid spending money on it until you’re in clearer financial waters. Things like the gym membership you rarely use, new shoes, and movies are in this category. Make your main expense priority the payment of your debt — it becomes a “must have.”

 

Shrink your waistline — and your wallet

#5: Eliminate extras

Want to slash extra spending from your budget — and maybe shed a few pounds as well? Take a look at what “extras” you can eliminate from your budget. Things like dining out, fast food, and trips to the coffee shop can add up to not only a lot of extra spending but quite a few extra calories as well. Slash excess treats from your diet and you may end up cutting costs, too.

#6 Write down your expenses

Write down what you spend. Your debt is built up over time of many small purchases, and if you can track these items and manage to get them under control, you can have better and faster success of keeping your debt from increasing and an easier time paying it off.

#7 Stop spending

Stop spending! Cut your cards in half. Experts agree that you should have no more than one active credit card at a time. Get rid of department store cards and gas cards, and use your one card only for emergencies.

Tackle the worst first

#8 Pay off high interest debt first

Pay the most each month on the cards with the highest interest and the lowest amount on the cards with the lowest interest. Doing this will ensure you pay off the high-interest cards more quickly and save in the long run.

#9 Pay off debts with smallest balances first

Pay the debts with the smallest balance first and the minimum on other debts — this likely eliminates the smallest debt first, and gives you a much-needed boost of confidence.

#10 Don’t close the account

Once you’ve paid off a credit card, avoid the temptation to re-up your balance with more purchases — but avoid closing the account. Closing accounts could negatively affect your credit score.

What have you guys found to be most helpful to get ouf debt?

Let us know in the comments!

What happens when a borrower does not pay back his loan?

At BTCJam, we strive to deliver the best possible returns with the lowest risk to our investors. We have many protocols to ensure that we feature high quality borrowers while we actively try to filter out scams and bad borrowers.

The first thing we do is to collect various points of identification: ebay, paypal accounts, banking statements, social network information, etc about the borrowers. We verify all those documents and accounts through our experienced team.
Second, we assess the borrower based on his information with our credit scoring algorithm. We assign every borrower a score ranging from A+ to E-, depending on the likelihood that they payback investors.
Finally, the “wisdom of the crowds,” –our dear investors, decide who gets funded. As you may know, an individual is usually not very good at making an estimate, but when you average out the esitmates of a large group of people the outcome is more accurate.  Of course, having multiple investors involved is no guarantee that a borrower will repay, but it is less likely that a large group of people will be fooled by someone compared to just one person. We suggest that investors pay more attention to loans that are funded by multiple people. The returns may be lower, but they are more safe.

On a separate note, make sure that you diversify you investments as much as possible. Learn more about this here:

What happens, if despite of all this, someone still does not pay me back?

If a borrower misses one of his payments for the first time, we try to get in contact with him via email or phone. If we get a hold of them and they manage to pay back with a slight delay, we will accept the late payment with a processing fee and return the money immediately.

If a borrower does not respond to us within 90 days, we start an arbitration process.

What is International Arbitration?

Arbitrators are neutral third-parties to whom the parties yield the power to decide the dispute and render an arbitration award similar to a court judgment while avoiding the cost and delays common in court litigation. Arbitration is a faster, more efficient legal alternative than bringing someone to court. It is interesting to note that arbitration was the only means of resolving disputes for thousands of years before there were courts. Courts actually embrace arbitration to resolve civil disputes since it reduces the size of court dockets. Arbitration is binding (cannot be appealed) and is recognized and enforced in nearly 150 countries under The United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958). For example, if a Canadian borrower fails to pay back their loan, then a Canadian arbitration company contacts the individual to collect the loan. The arbitration companies we use are similar and often overlap with those used by large corporate banks.

What are the benefits of International Arbitration?

  • Safer investments
  • Debt renegotiation
  • Enforcement

Which loans are susceptible to arbitration?

All loans made after 03/30/2013.

When is a loan sent to arbitration?

When it is overdue for more than 90 days.

Do I need to submit the loan to arbitration myself?

No, the loans are sent to arbitration automatically. The borrower and all the investors will be notified if it happens.