Monday, May 6, 2013

Butterfly Labs Bitcoin Mining Scam.

Many people are upset with the delays they are having in receiving their ASIC hardware to mine bitcoins from Butterfly Labs,  many of these people have paid with bitcoins. Others with paypal, others with bank transfers - they do not accept credit cards from what I can gather.

Why would you not accept credit cards if you are a legitimate company? Because refunds can be charged back over very long periods of time - Paypal allows only 60 days - Butterfly Labs lead time is 88 days. That's 28 days later than the cut off. Bitcoins are simply not reversible.

Call me sceptical but this appears to me to be a way to scam people into giving them money - and they have no need to ship products to make a profit.

There is a no refund policy unless they fail to ship - If they fail to ship their product (which I suspect they will)  and you paid by Paypal - you have no recourse if they decide not to refund - this is also true for bank transfers.

If you pay by bitcoin - you have to trust them.

Lets assume they do refund you and do not ship the item. If you paid in bitcoins - and the price of bitcoins goes up - then they will refund you in dollars - if the price goes down - they can refund you in bitcoins - they are essentially using your money to play the market - if it goes up they make a mint - if it goes down - they incur no risk.

I would be happy to hear from people who have received their units the world over and know what the time scales between order and delivery were and if the units themselves live up the hype.  Did you pay by bitcoin, bank transfer or Paypal?

What are your opinions?

1 comment:

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