SMS to Bitcoin UK - bitcoin-services.co.uk

[atifkhan]

Hi
I have just launched an sms to bitcoin service at www.bitcoin-services.co.uk/sms-to-bitcoin.php
At the moment I'm paying out a total of
0.3 bitcoins per £5
      0.2 bitcoins are sent instantly, and the other 0.1 bitcoins are sent after 60 days once I receive a payout from the provider in case of charge backs or abuse. I may vary the charges so check on the site for the current payout.
The network operators take a huge chunk of the funds,just under 50% so I'm trying to give the best payout I can taking into account of the risk of chargebacks or non payment from the providers.

[mila]

your prices are not cool.
a week or two ago I thought 6 eur for 1/4 btc is gross but kinda acceptable
today 7.23 eur for 1/10 is stealing

[tehace]

Has anyone tried this service?

[mila]

i spent 30 eur there last week or two weeks ago to get 1.25 btc (not on sms2btc but the premium number call but it's the same service)
it worked as expected
the prices today/yesterday are just robbery

[addi]

pretty cool service, your prices are insane tho, consider lowering and I may use it now and then

[Herodes]

pretty cool service, your prices are insane tho, consider lowering and I may use it now and then

There was dialcoin, and there was sms2btc (I ran this).

Prices are not cool, and do you good folks know why ?

Because there's far too many scammers out there, who will run up phone credits on stolen credit cards, use someone elses phone etc. The seller of bitcoins for sms can experience chargebacks 90 days after a purchase is done, so it's basically a useless business model.

So, what seemingly seems like exceedlingly high prices are just the operator trying to turn a profit while paying the high fees to the middle men, and twarting fraud attempts.

It's not fun to be on the operating end of this.

[Vicente]

Keep a close eye at every single transaction.  It's very likely someone will report their phones stolen, and guess what...you will already have given them bitcoins and you will not get your money.

[johnwhitestar]

The prices are that high not because the guy who is running the service want them to be so high.
I guess he is using the operator like txtnation which offers the insane surcharge for the service they are offering (at least from the point of view of the final user in this case).

[Herodes]

The prices are that high not because the guy who is running the service want them to be so high.
I guess he is using the operator like txtnation which offers the insane surcharge for the service they are offering (at least from the point of view of the final user in this case).

Yes, and by the time some hacker breaks into a cell operators homepage and starts sending messages from their web interfaces to pay for the coins, the wallet will be just empty. :\

[johnwhitestar]

The prices are that high not because the guy who is running the service want them to be so high.
I guess he is using the operator like txtnation which offers the insane surcharge for the service they are offering (at least from the point of view of the final user in this case).

Yes, and by the time some hacker breaks into a cell operators homepage and starts sending messages from their web interfaces to pay for the coins, the wallet will be just empty. :\

I wouldn't be too much sure it would be such a simple task to accomplish, but the charge-back problem is quite big for the guy that is running this service. In any case, his service would be very useful in the moments when the BTC are suddenly very low and there is no way to send money quickly on mtgox (for instance at the weekend).

[Herodes]

The prices are that high not because the guy who is running the service want them to be so high.
I guess he is using the operator like txtnation which offers the insane surcharge for the service they are offering (at least from the point of view of the final user in this case).

Yes, and by the time some hacker breaks into a cell operators homepage and starts sending messages from their web interfaces to pay for the coins, the wallet will be just empty. :\

I wouldn't be too much sure it would be such a simple task to accomplish, but the charge-back problem is quite big for the guy that is running this service. In any case, his service would be very useful in the moments when the BTC are suddenly very low and there is no way to send money quickly on mtgox (for instance at the weekend).

Bitcoins over mobile phone is surely a killer app, it it could be made safely. Never said it was easy to pull off a mass heist, and there will most likely be safeguard in place with the provider.

Another problem is that for a service to be sustainable, it must also turn a profit. If the time is spent avoiding fraud, and it turns no or little profit, then there's no incentive for running it.

I've thought of many schemes about how to verify a purchaser, but the whole point of purchasing coins with the phone is ease of use. Once that ease of use vanish, for instance if it will take days to verify a user, then the whole idea of ease of use goes out the window, and using traditional methods seems to be a better bet.

From the operators point of view, what he really needs to know is whether the payments are really legit or not. Not knowing this until months have passed by, makes for a very unpleasant experience. If ringtones were sold, even if 5% were fraudulently obtained and never paid for, the operator would still be in great profit. The same would not necessarily be true with a bitcoin operator. Also it's possible to send text messages that seems to be from someone else, with the right access to the network, whether or not this could be used to scam the operator into giving away bitcoins is a good question, I'm not technical familiar with all the steps involved, but if there's money to be made from it, it will be done.

Anyway, although I sound very pessimistic, I really wish a service like this would be something that could flourish and be a nice addition to the community. But it's hard to have nice things, when there's always people scamming.

[johnwhitestar]

The prices are that high not because the guy who is running the service want them to be so high.
I guess he is using the operator like txtnation which offers the insane surcharge for the service they are offering (at least from the point of view of the final user in this case).

Yes, and by the time some hacker breaks into a cell operators homepage and starts sending messages from their web interfaces to pay for the coins, the wallet will be just empty. :\

I wouldn't be too much sure it would be such a simple task to accomplish, but the charge-back problem is quite big for the guy that is running this service. In any case, his service would be very useful in the moments when the BTC are suddenly very low and there is no way to send money quickly on mtgox (for instance at the weekend).

Bitcoins over mobile phone is surely a killer app, it it could be made safely. Never said it was easy to pull off a mass heist, and there will most likely be safeguard in place with the provider.

Another problem is that for a service to be sustainable, it must also turn a profit. If the time is spent avoiding fraud, and it turns no or little profit, then there's no incentive for running it.

I've thought of many schemes about how to verify a purchaser, but the whole point of purchasing coins with the phone is ease of use. Once that ease of use vanish, for instance if it will take days to verify a user, then the whole idea of ease of use goes out the window, and using traditional methods seems to be a better bet.

From the operators point of view, what he really needs to know is whether the payments are really legit or not. Not knowing this until months have passed by, makes for a very unpleasant experience. If ringtones were sold, even if 5% were fraudulently obtained and never paid for, the operator would still be in great profit. The same would not necessarily be true with a bitcoin operator. Also it's possible to send text messages that seems to be from someone else, with the right access to the network, whether or not this could be used to scam the operator into giving away bitcoins is a good question, I'm not technical familiar with all the steps involved, but if there's money to be made from it, it will be done.

Anyway, although I sound very pessimistic, I really wish a service like this would be something that could flourish and be a nice addition to the community. But it's hard to have nice things, when there's always people scamming.

I thought about this kind of service as well. It might be organized in the following way: the user sends a request to a short number and receive an sms with code for which he is billed (something like 1$ for instance). To receive btc he has to access a site where he is know and registered and to put his code there. The problem is that the provider of the short messages service charges a very high surcharge (something like 70% or more).
The service might be offered to those countries where is difficult to operate through the bank.

[Herodes]

The typical use case for buying bitcoins with your cell would be:

Bitcoins ? Cool, I want some in a couple of minutes, to try out this bitcoin service, to pay for hosting or whatever.

- Picks up phone, googles bitcoin for phone credit, finds site, does the few steps, receives coins. All done in 2 minutes.

This would all be fine and dandy if it was not for the numerous way an operator could be cheated for coins.

I thought about this kind of service as well. It might be organized in the following way: the user sends a request to a short number and receive an sms with code for which he is billed (something like 1$ for instance). To receive btc he has to access a site where he is know and registered and to put his code there. The problem is that the provider of the short messages service charges a very high surcharge (something like 70% or more).
The service might be offered to those countries where is difficult to operate through the bank.

What you propose is that a user is registered on a site, which basically adds no extra security, unless you do verification, which may take quite the while, to establish with a certain degree of certainty that a user is who he says he is, and then the ease of use is gone, and he might just as well have exchanged cash for btc, or sened money to an exchange.

For those countries where bank accounts are more difficult, I think there are services offering btc for prepaid cards (cash -u).

[johnwhitestar]

What you propose is that a user is registered on a site, which basically adds no extra security, unless you do verification, which may take quite the while, to establish with a certain degree of certainty that a user is who he says he is, and then the ease of use is gone, and he might just as well have exchanged cash for btc, or sened money to an exchange.

It's true, the site would need a verification of the person and the ease of use is a bit gone in this way but once registered the user would have an additional channel for the quick trading, and the service provider would have more security sending BTCs, but the paid phone call/short messages provider with the low surcharge would be needed.

[Herodes]

What you propose is that a user is registered on a site, which basically adds no extra security, unless you do verification, which may take quite the while, to establish with a certain degree of certainty that a user is who he says he is, and then the ease of use is gone, and he might just as well have exchanged cash for btc, or sened money to an exchange.

It's true, the site would need a verification of the person and the ease of use is a bit gone in this way but once registered the user would have an additional channel for the quick trading, and the service provider would have more security sending BTCs, but the paid phone call/short messages provider with the low surcharge would be needed.

It is true that once registered, the user would have a channel for getting easy and fast bitcoins. But if the user at all plans to buy any sizeable amount of bitcoins, he would be better off exchanging locally for cash or sending money to an exchange.

There may be cases where someone have the cell bill covered by their workplace and starts buying coins, but not sure if employeer will be too happy if bill start to get too high! And there may be other cases where users will dumpt phone credits for whatever reason, and rather have bitcoin (leaving the country, having no use for their prepaid phone service any more), or emptying credits if they are expiring (?).

But frankly, I think sms purchase would mainly be for those just wanting to dabbling into bitcoin, but of course I could be wrong. I guess some people would not care if prices was twice that of an exchange, but I would think most people would find that price too high.

If I remember correctly, it was impulsepay that I implemented the sms service with, and everything worked fine, it's just that the possibility of scamming seems to be too high. And when chargebacks can occur as long as 90 days after the sale, then that doesn't give the operator much room for stability in regards to the finances. You may be churning along quite happily, and then one cell operator sends along a batch of chargebacks, and suddenly you're out a sizeable amount, that's not fun.

It's also the same reasons why all operators selling bitcoins for CC's are very short lived. Here, you just have a middelman, the phone operator as a proxy, so the risks are basically the same. Also, I don't know quite how it works in the UK, but in some countries you can have a phone subscription on credit, and pay the bill after usage, so you could actually rack up quite the large bill the first month, and if the account was fraudulently aquired, there's no recourse for the phone company, and they surely will not pay the payment operator, which again will not pay you, and you're again out of bitcoins.

This will happen, trust me. Once there's a way to get 'free' money, someone will exploit it.

[johnwhitestar]

What you propose is that a user is registered on a site, which basically adds no extra security, unless you do verification, which may take quite the while, to establish with a certain degree of certainty that a user is who he says he is, and then the ease of use is gone, and he might just as well have exchanged cash for btc, or sened money to an exchange.

It's true, the site would need a verification of the person and the ease of use is a bit gone in this way but once registered the user would have an additional channel for the quick trading, and the service provider would have more security sending BTCs, but the paid phone call/short messages provider with the low surcharge would be needed.

It is true that once registered, the user would have a channel for getting easy and fast bitcoins. But if the user at all plans to buy any sizeable amount of bitcoins, he would be better off exchanging locally for cash or sending money to an exchange.

There may be cases where someone have the cell bill covered by their workplace and starts buying coins, but not sure if employeer will be too happy if bill start to get too high! And there may be other cases where users will dumpt phone credits for whatever reason, and rather have bitcoin (leaving the country, having no use for their prepaid phone service any more), or emptying credits if they are expiring (?).

But frankly, I think sms purchase would mainly be for those just wanting to dabbling into bitcoin, but of course I could be wrong. I guess some people would not care if prices was twice that of an exchange, but I would think most people would find that price too high.

If I remember correctly, it was impulsepay that I implemented the sms service with, and everything worked fine, it's just that the possibility of scamming seems to be too high. And when chargebacks can occur as long as 90 days after the sale, then that doesn't give the operator much room for stability in regards to the finances. You may be churning along quite happily, and then one cell operator sends along a batch of chargebacks, and suddenly you're out a sizeable amount, that's not fun.

It's also the same reasons why all operators selling bitcoins for CC's are very short lived. Here, you just have a middelman, the phone operator as a proxy, so the risks are basically the same. Also, I don't know quite how it works in the UK, but in some countries you can have a phone subscription on credit, and pay the bill after usage, so you could actually rack up quite the large bill the first month, and if the account was fraudulently aquired, there's no recourse for the phone company, and they surely will not pay the payment operator, which again will not pay you, and you're again out of bitcoins.

This will happen, trust me. Once there's a way to get 'free' money, someone will exploit it.

Interesting.
So let us see how this guy will be able to manage the thing, we both have thought before, but have found being too risky.

[Herodes]

Interesting.
So let us see how this guy will be able to manage the thing, we both have thought before, but have found being too risky.

Surely, I wish him all the best!

[Risse]

Yeah, reporting a phone stolen is always a problem with SMS services... I suggest having a big enough overhead that you can afford a few lost transactions here and there. But, good luck on your endeavour, hope you won't have too many problems

[whitenight639]

Hi
I have just launched an sms to bitcoin service at www.bitcoin-services.co.uk/sms-to-bitcoin.php
At the moment I'm paying out a total of
0.3 bitcoins per £5
      0.2 bitcoins are sent instantly, and the other 0.1 bitcoins are sent after 60 days once I receive a payout from the provider in case of charge backs or abuse. I may vary the charges so check on the site for the current payout.
The network operators take a huge chunk of the funds,just under 50% so I'm trying to give the best payout I can taking into account of the risk of chargebacks or non payment from the providers.

That's so irritating, you beat me to it I was just starting to build a site to do the exact same thing, I found a provider that supposedly does not do charge backs and integrates Customer phone Billing over WAP as well as Premium SMS.

[whitenight639]

pretty cool service, your prices are insane tho, consider lowering and I may use it now and then

There was dialcoin, and there was sms2btc (I ran this).

Prices are not cool, and do you good folks know why ?

Because there's far too many scammers out there, who will run up phone credits on stolen credit cards, use someone elses phone etc. The seller of bitcoins for sms can experience chargebacks 90 days after a purchase is done, so it's basically a useless business model.

So, what seemingly seems like exceedlingly high prices are just the operator trying to turn a profit while paying the high fees to the middle men, and twarting fraud attempts.

It's not fun to be on the operating end of this.

What happened with your sms2btc if you don't mind me asking? did you get scammed or give up before you got scammed?