I've been doing more research on this, and USD funds at Bitfloor are in no way protected by FDIC or any federal laws. These are not legitimate bank account fund deposits, they are simply payments you made for a service/product, and are nothing more than an internal credit for you on the books. It's no different than pre-paying a cell-phone with USD, you are not guaranteed anything if the business closes aside from what bankruptcy court or lawsuits will get you.

This whole lying about "federal laws" protecting your USD "deposits" - and that you have nothing to worry about, by people who also seem to constantly post here defending Bitfloor at every opportunity is just one more reason not to trust Bitfloor with your banking details.

FinCEN is about reporting to the gov, it has nothing to do with consumer protection.

Yes.

If you are trying to get USD into Bitfloor right now, you are the only one here like that.

We are all trying to get it out. Preferably via a check by mail, no way I'm going to give more personal details to Bitfloor.

> It is indeed true that your funds in Bitfloor are protected by federal banking laws.

Which laws?

FinCEN is about money laundering, not about consumer protection. I was just hoping when I said it (and have seen it stated before), but with the way you have dismissed my points with great confidence and name-calling, you seem to know more exactly. Please, I really would like to know.

Was Bitfloor registered as a bank, as a money exchange, etc? Or was it just a simple LLC, or C-corp or S-corp? If he declares bankruptcy of the business, what stops him from taking our combined unprotected USD funds (if he is not a bank, etc) that are in his business bank account to pay the bad debts (or what if everyone's combinded funds don't match the current balance due to circumstances)... You took the risk of giving money to him for some service or product. Which laws protect you?...

Money on the books get lost all the time in bankruptcies. People and companies pay a failing business, business never delivers product, business declares bankruptcy, that original customer gets nothing, or only a small fraction of the original amount.

> ACH is easily reversible

You really should search "ACH fraud" to get an idea of what you are referencing. It's not as simple as you make it out to be. You can be out of funds for a long time if this happens.

>  so Roman trying ACH fraud is just a ridiculous tinfoil-hat assertion

Right. Because Bitcoins and the criminal element are about as far apart from each other as they can be. As history has shown us. Real tinfoil stuff here.

All I said was that it's not a good idea to give up bank account numbers to a failing business so you can terminate your relationship with them.

Roman Shtylman seems like a stand-up guy, but lets not pretend that things can get over your head and control real quick when shit like this happens.

Just look at what this guy has said about the previous incedent...


Sounds like everything is fine here.

How much do you think they still owe?

I check my bank statements every 30 days. And so do a lot of other people. And if you've ever dealt with debit or check fraud, you'd know it's not as simple and quick of a process as you make it out to be.

You still have not deconstructed anything I've said. But you took the time to post that FUD accusation crap that added nothing to the conversation.

If you think this is FUD, please deconstruct my argument. Show everyone how ACH can't be used to transfer funds out of bank accounts (that it's only 1 way), that Bitfloor never had security issues (thousands of BTC were not stolen), that check-by-mail is an unacceptable and unreasonable method of payment, that everyone got their email about the EX halt (just reference what other users have posted here), etc.

They are (most likely) a folding business now, and have had serious past security issues, and the way they handled this latest mess was to tweet about suspending trading within a few hours of the deadline, and only sending out emails to preferential users (I never got mine and neither did a bunch of other people).

By giving Bitfloor your bank account's routing numbers, you are giving them the ability to withdraw any amount of funds they wish at any time from your bank account, or worse, cause another security incident where hackers end up with your bank details.

This whole mess could have been prevented by simply not accepting new deposits, and NOT suspending trading while allowing everyone to exchange USD to BTC so they can transfer out at ease – they could have limited the sell price to 110% of MtGox's (to prevent price gouging) and everyone (including sellers) would have been happy. Or used an opt-in option where everyone's USD funds could have been used to purchase BTC at market value on MtGox, and dispersing them accordingly. But none of that really matters...

I simply don't trust Bitfloor any more due to it all combined.

Don't put up with this shit by giving Bitfloor more of your personal and business details just so you can end your relationship with them.

Demand that Bitfloor sends you a check by mail. Your USD funds are protected by federal banking laws and regulations, they simply can't demand that bank transfers will be the only method allowed to get your funds out. If they keep your USD funds they are committing serious offenses. Checks are perfectly reasonable and are the default method at all businesses, banks, and institutions. By not allowing this option, this whole thing seems shady as fuck to me. It's quicker to print out a check then it is to verify, secure, and maintain your bank account details.

https://twitter.com/bitfloor/status/324876008719265792

If you don't know, then assume it makes it so you access the onion/tor network through a 3rd party web-to-tor proxy service (onion.to) that is probably either run by the FBI/DEA - or collects your login info, or spoofs websites - for profit.

BitInstant's btc-e reserves appeared to be fully funded this morning (~30g USD), and you could select in the menu to send to btc-e, but now btc-e is down, so that option is off.

At least they are not taking payments for broken methods any more.

Just said enough is enough, created email account at tormail via Tor, created account at BitFloor via Tor (just need email addy, password, nothing else), got deposit info, went to Bank Of America, asked for out-of-state deposit slip, filled in account and some other info (note - no where do you put your personal info - just write in the business name and address in main section), didn't get asked for ID, got home, money was in my BitFloor account, made market order in 1 second, had my BitCoins, transfered out to SR address.

Cost was 1% fee total.

It's basically just about almost less work that using BitInstant.

Their new message (at bottom of website) is they will be back in operation on the 1st, so don't count on this being resolved until that day plus a week (to catch up and unravel all the fucking up that happened this last month).

This of course assumes they come back at all.

The 25th came and passed, BitInstant still has not funded their reserves on BTC-e, and now there new message on their website says -

There is no difference between using MoneyGram at WalMart and MoneyGram at CVS, or anywhere else. It's the same form, it's the same service.

What it sounds like is either you or the clerk wrote/entered the wrong account number to send money to, or specified the wrong info to BitInstant, or BitInstant fucked it up...

If you take a look into BitInstant's support thread, you'll see that they are practically a black hole right now, with a bunch of money missing, and the people who run it and their support people gone/missing.

https://www.bitinstant.com/order_status/447759d2-a624-4507-8ccc-6fd9423ea46b

You need to contact support.

It's Monday, 2pm EST, BitInstant's BTC-e reserves are $5 USD, and everything still looks defunct. People are posting about failed transactions that haven't been resolved in weeks.

I don't think BitInstant is scamming, because they did resolve a bunch of other transactions when this whole mess started, but something just doesn't look good to me.

There might be more delays to come.

If you need to contact someone at BitInstant, the email addresses of the top 4 guys is here -
https://www.bitinstant.com/aboutus

The shutdown of SilkRoad and the gambling sites would pretty much kill the market, as that is what is bootstrapping Bitcoin and driving the demand (and giving it real value). Get rid of that before the bitcoin market evolves passed it (if it even can), and it's dead.

Or kill TOR, or make it unusable in some way. Anonymity gone? Bitcoins gone.

Now those are real, actionable threats.

Looks to be removed just now.

When you send cash via MG to zipzap, BitInstant is notified, and then on BTC-e (where BitInstant has "reserves"), they use the funds of the reserves in the process of getting you your bitcoins (*though they quote you MtGox bitcoin prices, which are greater than BTC-e's)... The cash you send them does not actually buy anything (at that time), I don't think BitInstant even gets that cash until a week or a month, or whatever, later.

The problem so far is BitInstant BTC-e reserves are non-existent. They've not been replenished for a long time now. So until you see some serious "Reserves" amounts listed at https://btc-e.com/ (reserves are at $33 USD right now), I think BitInstant has to perform "manual" transfers which don't involve the reserves, but some other account that has bitcoins or USD (how much that account has I don't know).

I'm also getting the feeling that for this to happen you have to contact BitInstant support, or they'll just wait and wait and sit on it - until more reserves are deposited at BTC-e and their system can try again. I'm also getting the feeling that a lot of people's transactions are falling through the cracks.

Either way, I was hoping to use BitInstant a second time, but there seems to be too many issues around everything (exchange problems, reserve problems, DDoS, hackers, poor/slow service, fucked up level of little to no information, etc). And those issues keep happening over and over.

If I had to guess at what's happening, BitInstant doesn't have enough money to perform all the transactions, and they are now waiting on ZipZap to pay them... The issue here is that you can get into a situation where you get so far behind and appart (you have a bunch of growing incomplete past transactions, and too little new money coming in to cover them), that at some point you can no longer do business (too many debts/liabilities that can't be paid off in 12 months) and you have to (by law) file for bankruptcy. And unless there are assets to be seized and re-distributed, everyone looses their money.

Just a heads up about your DNS...

I kept on going to http://bitinstant.com/, hoping to either get to the website or a redirect to www.bitinstant.com.

The former address has no response.

And I kept on thinking that the website was down.

The DNS is delegated to CloudFlare, and the resource records point to different IPs for the "@" and "www" hosts.


There is obviously no response from the base domain and it makes it look like the site is down. I don't know if this is the way it always was, or if some records didn't get updated, or there is a purpose to this, but the unresponsive IP is also owned by Amazon EC2.