Bitcoin Forum

This open letter is in response to your Shipment and Refund Letter (https://bitcointalk.org/index.php?topic=262052.msg4206282#msg4206282 (https://bitcointalk.org/index.php?topic=262052.msg4206282#msg4206282))  earlier today.

In the beginning, Hashfast convinced the entire community that they were the next evolution in ASIC manufaturers, being honest above-board and communicative.  In fact, it took quite a bit of convincing to get me to pull the trigger.  Having been burned previously I had initially decided not to order.  After many posts by Simon and John (via the Hashfast account), I slowly came around.  Full BTC refunds, the MPP program, imminent delivery (being on track to deliver at the end of October) all convinced me that my BTC was safe and that this would be the a solid investment.

Since then as we all know Hashfast has turned out to be a completely different company.  

• You guys were never on track to deliver in October (not even close), effectively selling January equipment @ October prices.
• You never actually intended to provide full refunds, as it turns out, that was a complete lie.
• You repeatedly modified the TOS to the detriment of your customers. Most changes were done secretly without versioning and are now expecting customers who ordered in August to be bound by the modified terms.
• John and I'm at this point convinced Eduardo, employed the use of shill accounts (iCEBREAKER, bitcoinermax and others) to badmouth competition and squash negative posts whenever directed towards your company.

So in response to your email I answer your 6 questions below:
  1) Batch 1 Order Number: 1460
  2) Product & Quantities: Babyjet x 2
  3) Full Name: *withheld*
  4) Shipping Address: *withheld*
  5) Method of Payment: Direct BTC transfer (http://blockchain.info/tx/b97e4a16ebf5e7da03a32e0c31fe04de69c29ddde689f2c03f0ccb5c67ae7075 (http://blockchain.info/tx/b97e4a16ebf5e7da03a32e0c31fe04de69c29ddde689f2c03f0ccb5c67ae7075))
  6) Confirmation that I understand USD order totals that were originally paid with BTC can be refunded in BTC at the USD to BTC market exchange rate on the date of refund: NO I DO NOT CONFIRM

Hashfast is in clear violation of FTC guidelines regarding refunds (http://business.ftc.gov/documents/bus02-business-guide-mail-and-telephone-order-merchandise-rule (http://business.ftc.gov/documents/bus02-business-guide-mail-and-telephone-order-merchandise-rule)).

I, pursuant to my rights as defined in the above linked guidelines demand a full BTC refund (89.27399159 btc) within 7 days of receipt of this request.

*Reserved for official Hashfast reply.*

Many have lost a lot, I myself spent 280 BTC on 5 hashfast units. And remember the earlier TOS that state full refund in BTC.
That of course been modified, I never expect to see those BTC back ever again  :-\

And I remember the OCT 21-31 delivery dates, of course those are removed. Now its not even ready for shipping, at this rate
I won't be getting em to late Jan, and by the time I get em, each will make like 8 bitcents every 24 hours.

I thought it was in their memo to serve, and make sure their first batch customers are treated the best.
If they had any sense of mind, they could decdiate a bit of their company, to building tons and tons of hashfasts.
Point em all at a pool, and work towards mining back what they owe me. If they can't refund the 280 BTC.

At least they can build a ton more asics, and somehow make up for it. If they for example ship my 5 hashfast units at 2 TH.
And have 25 TH in the back mining for 6 months to my name, once all the BTC is payed out, then turn off those other 25TH.

As ASICS are a huge mark up, so they could in theory spend a lot less doing this method, instead of sending back 280 BTC at current market cost
or $230,000+. Maybe someone can email them about this idea, and perhaps something like that can be arranged.

And make some kind of threat, if they are not willing to help batch 1 in this way, or another, then we can all collaborate, gather all the evidence together.
And bring them to court, perhaps then they will talk more about this.

Just some ideas, but sadly I lost a lot.

^^ Ouch

If you read the actual text of 16 CFR 435 it says:

"(d) Refund shall mean:
(1) Where the buyer tendered full payment for the unshipped merchandise in the form of cash, check, or money order, a return of the amount tendered in the form of cash, check, or money order;

(2) Where there is a credit sale:
(i) And the seller is a creditor, a copy of a credit memorandum or the like or an account statement reflecting the removal or absence of any remaining charge incurred as a result of the sale from the buyer's account;
(ii) And a third party is the creditor, a copy of an appropriate credit memorandum or the like to the third party creditor which will remove the charge from the buyer's account or a statement from the seller acknowledging the cancellation of the order and representing that it has not taken any action regarding the order which will result in a charge to the buyer's account with the third party;
(iii) And the buyer tendered partial payment for the unshipped merchandise in the form of cash, check, or money order, a return of the amount tendered in the form of cash, check, or money order."

Bitcoins do not meet the definition of cash, check, or money order. (While they may be "money", "money" is not the same as "cash")

Compliance with the rule is not possible.

The problem is actually finding a lawyer with the knowledge and desire to take on a case such as this.  I personally would be willing to pay up to 50% in lawyer fees to see Hashfast pay for their underhanded practices.

I'm sure others would as well.

lol...we bought from a company that can't even accurately put numbers into a calculator, and obviously knows nothing about Bitcoin.  I really don't think any consumer protection laws apply in the Bitcoin space.  BFL, Avalon, bASIC, KNC...any legal action?  Chasing unicorns...

Currency also does not equal cash. FinCEN also said that virtual currencies are NOT legal tender.

The Coinlab case is different as a contractual obligation is, and should be, enforced as written.

Batch 1 customers have a contract as well. 

I'm beginning to think you are just a troll.

My interest in what other people think of me is limited, and even less so when those thoughts are motivated by disagreement.

Troll or not, I am simply saying that, using the Mail Order Rule as the basis of demanding a BTC refund is not the strongest idea and that my assessment of the rule is that, when paid in BTC, such a refund need not be performed in the manner outlined by the rule.

He is using the mail order as a point in demanding the refund as its been more than enough time for them to deliver, the BTC refund is based on the contract of the terms of sale at the time of his purchase.

Not obtuse at all.

USD are legal tender for all debts public and private.

The Baby Jets were priced in USD and the delivery date was unknown but to be performed on best efforts basis and the future exchange rate of BTC is irrelevant to the contract unless there was a specific term that shifted it somehow like a put or call contract.

Consequently, the FinCEN guidance and your reasoning from it is also flawed. Additionally, just look to the UCC to see how foreign currency payments are treated (3-107 or 4-214).

If HF delivers Batch 1 Baby Jets in January then I think it will be very difficult to prove HF has not made best efforts relative to common industry practices to get the merchandise delivered.

I thought it was in the TOS that refunds were to be in USD at the price of the Baby Jets or in BTC at the amount paid and at the discretion of the customer so long as there were enough other people on the wait list so there would not be unsold Baby Jets. But I am not aware of any screenshots or prints of the TOS so that returns the BTC exchange rate issue to irrelevance.

Consequently, I think it will be very difficult to find an attorney to take this case and even more difficult to find one to take it on contingency because you will likely lose.

Would public statements made by the CTO prior to sale effect this at all?



The USD addition to the TOS didn't happen until very recently.

I suppose my problem is that I had assumed that the court system would frown upon a company making statements prior to sale that conflict with their actions after.

In retrospect, I can see how that assumption was a bit naive.

The fact that it currently might not be legal tender does NOT interrupt its EQUIVALENCE to currency!. Do listen to the director of FInCEN acknowledging Bitcoin status back in November irrespective of "tenderness":

"....A convertible virtual currency either has an equivalent value in real currency, or ACTS as a SUBSTITUTE for real currency. In other words, it IS a virtual currency that CAN be exchanged for REAL currency...."

In other words, we don't give a shit if it's "legal" tender or not. If HF is TAKING currency from us, for applicable refunds, HF needs to refund 100% of that currency to us.

Anyhow, leave that to a lawyer and let's not waste time believing we are lawyers.  

The People of The United States of America vs. Hashfast. Let the lawsuit begin!!

Can someone please post online a TEXT version of both the OLD email confirmation (with full refund text) and old TOS to show to judges the multiple violations HF is liable for?

Are you a HF shill??  You sound like having a loser mindset otherwise.. Anyhow, don't think. READ the TOS: NO USD exchange and no "subject to people wait list" bullshit either.

This is the single most important step.  IIRC the ToS stated that all official communication, post purchase, between customer and HF needs to be done in this capacity.

It's absolutely astonishing how many people either did not read the ToS they agreed to, or failed to have it reviewed by proper council.

And you will honor your lost bets when?

Hey Sunnakar -

The USD exchange rate wasn't listed in the TOS at the time of sale... however my receipt had the following text on it.


"full refund the payment" ... the payment was a BTC payment.

Oh, really?? Are you a lawyer or have become an HF shill?? You seem to be equally clueless of any legal shit as well. Why don't you just go back to the hole from where you delayed products for 6 months and constantly misled people. That's probably a better "firm grasp on reality."
As I said before, "tender" o no "tender" shit does nothing from a currency validity standpoint per as the latest FinCEN guidance:

https://bitcointalk.org/index.php?topic=391375.msg4215273#msg4215273

This guidance was provided by the FinCEN a bit over "two weeks" ago, BTW if that magic time period resonates ;-)

a few customers said that HF stated to them that they would actually get the same btc that they paid if refunded...  if that is in writing somewhere perhaps that could be enforced in court but who knows...  contract law and how shoddy HF is will make it all a crap shoot if it even gets that far

E.g.


and


In addition to the invoices in BTC that people received with the full refund text, which was only revised months after the sale to indicate that refunds would be of the USD amount at the time of the purchase.

In case you aren't familiar with the Wayback Machine, it may be useful to view the old ToS:

https://web.archive.org/web/*/https://hashfast.com/checkout/terms-of-sale/ (https://web.archive.org/web/*/https://hashfast.com/checkout/terms-of-sale/)

Unfortunately, the first snapshot it has is from the 1st of November.
The most interesting changes happaned in August / September.

We need to rely on snapsohts saved by individuals,
and on the versions enclosed in order confirmation emails.

This is a fascinating discussion. Sorry for those who have lost/may have lost money.

My general thought is that, at the very worst, there is a colorable argument for recovery of the current value of the Bitcoins. You can get interest on USD judgments in similar situations, and I don't see why this would be different. You'd simply get the "interest" measured based on Bitcoin's appreciation, rather than the standard interest rate.

That's not a commentary on this specific case. I haven't examined the various TOS provisions. But generally speaking, I think the above would be the worst-case (for consumers) default scenario.

::nods::

I think the key points are that they:

(1) Clearly promised full BTC refunds in the even that they didn't delivery in several venue and forum, including explicit direct communication

(2) Could easily have arranged to make full BTC refunds possible (by holding the coins or hedging against their change in value with an agreement with someone who was holding the coins). They claimed their manufacturing was paid for by investors, so the view that they'd hold the coin was completely realistic (and may be true).

(3) Sold products under terms that would have really only been attractive when secured by the expectation of refund of BTC paid in the event of default. They sold machines for BTC that produce BTC and can't practically be used for anything else, only a fool or a madman would buy such a machine without the expectation that they'd get as much or more BTC back from it.

When I purchased my hashrate estimate was that if they delivered on time my baby-jet units would lose about 10 BTC each, but since they were offering up to 4x more hashrate via MPP that would be enough to let me upgrade my mining hardware to "significantly less than 1.0 W/GH" at basically breakeven, or— if they were so late to deliver that MPP could not protect it against hashrate increases, that I'd receive a full refund of the BTC paid. It was my understanding and belief that hardware itself would be pretty profitable relative to COGS but I was willing to give up most of that profit with HF's high prices in exchange for they and their investors taking the considerable risk of delays and failures to deliver.

I gotta say, the trust system here is so hidden that it is basically useless. The BIG RED XXXX scammer tag needs to come back. I'm sure it doesn't work to give someone like inaba a scammer tag, since he pays so much to advertise here. But does hashfast advertise here? They are disappearing with money right now, all the promises about shipping on the 31st have been broken. They want people to sign away any chance of a refund, and they hired a new lawyer. All signs are bad.

So i am asking you as a moderator. How do they get a scammer tag? Refuse full BTC refunds for who asks or how?

I can't imagine that ALL manufacturing for all products was paid for investors. Do you think they used B1 preorders to fund R&D on new machines?

AFAIK we don't issue them anymore.

Once negatively rated by people in the default trust list, hashfast's posts will have a red warning next to them by people using the default trust list. It should be there already, in fact— is it not?

They claimed that they wouldn't be using pre-orders to fund development, what they actually did is anyone's guess— much of the coin they'd been paid had apparently not been moved when people were investigating this a week ago.

It's certainly possible, even likely, that they spent some portion of it to cover the actual manufacturing— but we wouldn't know when. Though assuming their hardware works those costs should be amply recoverable.

So i was right. This is now scammers den! Great!

Do you know the reasons behind that decision?

What do you mean the coin hadn't been moved? I'd love to read those posts.

What are the determinations of the "trusted" trust list? I see the list, but if someone isn't one of those select people, nobody ever sees the feedback they send. What's the point of feedback if only a few people are authorized to send it?

And applied appropriately to BFL, Avalon and HF by the sounds of it.

Trust system is so fucked up. It's small and it's based on a "default" small trusted list and if those 2-3 people decide not to get involved then it's useless. Is this the kind of open community that we want? Sad open community.