Let`s file a lawsuit against Butterfly Labs

[becoin]

2. They offer BTC acceptance as a side option. In other words, It's just an exchange service between BTC and USD.

They can't offer this option. They have no right to do this! To be "just" an exchange service you have to be "just" regulated as an exchange service... like MtGox, for instance!

CASE1. Merchant originally accept 1kg gold for 1 computer deal.
CASE2. Merchant originally accept USD for 1 computer and they have an additional service which is "Take some gold and exchange it to USD"

CASE3. Merchant doesn't sell you anything. Merchant just accepted your gold as a guarantee for PRE-ORDERING something!

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[roy7]

This is exactly how any sort of purchase in a foreign currency works. You pay money out of your account in USD, it is converted to the destination company's currency, and they deposit the money they receive in their native currency.

Assume Euros were trading 2 Euro for 1 USD. You order something from France for 100 Euro. You use your debit card to pay for it, and 50 USD comes out of your account. The French company does not have 50 USD sitting around, they have 100 Euro in their bank account. The currency exchange is handled by one of the intermediate banks.

A month goes by, you decide you want to return your product. One of three things might happen.

1 - USD/Euro hasn't moved. So you get 50 USD back.

2- Yay, USD is weaker vs the Euro at 1:1 now. So you get refunded 100 Euro which is converted to 100 USD. You came out $50 ahead.

3- Oh no, USD is stronger vs the Euro at 4:1 now. So you get refunded 100 Euro which is converted to 25 USD and you lost $25.

In all three cases, the company sold and refunded 100 Euro. They aren't engaging in currency speculation or market making. The funds you sent them are converted to Euro to do the sale. This is why large companies making large overseas orders will buy hedges against currency rate changes, so your costs don't skyrocket when the next bill is due because your native currency has grown weaker vs the foreign currency.

In this case you purchased a good from a company selling products in USD. The currency you used was bitcoin. It was converted to USD for purposes of this transaction based on the going exchange rate. If you want a refund in bitcoin, you get refunded in USD and it will convert back to bitcoin (or Euros, or whatever currency) at the going exchange rate.

If BFL didn't do it this way, it'd be dangerously irresponsible. They'd be using your pre-order funds to engage in currency speculation instead of producing hardware. What if the value of bitcoins dropped to 1/100 from the time you placed your order, and they were holding bitcoin not USD? Now the (say) $1500 USD you paid in bitcoin is only worth $15 when they convert it to USD to pay their suppliers, payroll, etc. They'd be bankrupt in a moment. And I'm sure history is full of companies that went bankrupt because of a massive overseas transaction + rapid currency movement + lack of hedging.

[becoin]

This is exactly how any sort of purchase in a foreign currency works.

You have no idea what you're talking about. Read something about how credit card system works. What is the role of the credit card issuing bank? What is the role of the credit card processor?

When you have a credit card account run in euro but you pay usd priced product, YOUR bank is doing the currency conversion for you. You have agreed to this when you have signed the credit card issuing agreement. The credit card issuing bank is converging your euros into dollars and is SENDING dollars. The TRANSACTION currency is dollars! A refund is nothing else but a REVERSAL of a transaction. This is why you get back dollars which are applied back to your euro account at current exchange rate. YOUR bank has a license to exchange currencies! It is regulated to do that!

I've SENT exact amount in bitcoin EXACTLY to the bitcoin address BFL asked me to send to. I'm not a BitPay customer. I have not signed any agreement with BitPay. BFL is a BitPay customer. Bitpay is doing currency conversion for BFL as per the contract between BFL and BitPay. When I paid bitcoins for pre-ordering from BFL the TRANSACTION currency is bitcoin. This is why the refund must be in bitcoin, not in dollars. If BFL claim I have sent dollars they must tell what bank dollar account I've used to do that?

[SgtSpike]

This is exactly how any sort of purchase in a foreign currency works.

You have no idea what you're talking about. Read something about how credit card system works. What is the role of the credit card issuing bank? What is the role of the credit card processor?

When you have a credit card account run in euro but you pay usd priced product, YOUR bank is doing the currency conversion for you. You have agreed to this when you have signed the credit card issuing agreement. The credit card issuing bank is converging your euros into dollars and is SENDING dollars. The TRANSACTION currency is dollars! A refund is nothing else but a REVERSAL of a transaction. This is why you get back dollars which are applied back to your euro account at current exchange rate. YOUR bank has a license to exchange currencies! It is regulated to do that!

I've SENT exact amount in bitcoin EXACTLY to the bitcoin address BFL asked me to send to. I'm not a BitPay customer. I have not signed any agreement with BitPay. BFL is a BitPay customer. Bitpay is doing currency conversion for BFL as per the contract between BFL and BitPay. When I paid bitcoins for pre-ordering from BFL the TRANSACTION currency is bitcoin. This is why the refund must be in bitcoin, not in dollars. If BFL claim I have sent dollars they must tell what bank dollar account I've used to do that?

Please stop talking until you get a courtroom to agree with you.

[becoin]

If BFL didn't do it this way, it'd be dangerously irresponsible. They'd be using your pre-order funds to engage in currency speculation instead of producing hardware. What if the value of bitcoins dropped to 1/100 from the time you placed your order, and they were holding bitcoin not USD? Now the (say) $1500 USD you paid in bitcoin is only worth $15 when they convert it to USD to pay their suppliers, payroll, etc. They'd be bankrupt in a moment. And I'm sure history is full of companies that went bankrupt because of a massive overseas transaction + rapid currency movement + lack of hedging.

That's BS!

1. They don't use pre-order money for production because after ALMOST an year they have produced NOTHING! Actually BFL customers are INVESTORS! Read the definition of FTC what is "pre-order" first before writing above nonsense! The maximum period for a delay while pre-ordering is 4 month. When did BFL start taking "pre-orders"?

2. BFL lied they have attracted VC! This is why they used pre-order money to pay their salaries.

3. Taking their customers bitcoins and refunding dollars BFL actually gets free option call to profit from possible bitcoin appreciation WITHOUT paying any premium. No court of law will tolerate such a behavior.

4. History is full of scammers trying to profit from peoples greed. BFL can't go bankrupt because they have promised nothing to their investors (pardon me, pre-ordering customers)! It is irresponsible AND ILLEGAL to treat your investors like that!

[gump]

I've my own ongoing experience with BFL, which hasn't been positive.  I've grown weary of their canned responses and refusal to work with me--interestingly, once they learned I had consulted an attorney, they ceased responding to my communications outright.  And that leaves me no other choice, but the obvious.

This all feels like a very clever ponzi scheme (think about that).   

It won't last, regardless of opinions, once enough people file official legal complaints with various governmental entities, this will be resolved.  Class action or otherwise.

Having said that, I will continue to believe in small technology startups.  BFL is an unfortunate exception to the spirit of what this represents.

[wasserman99]

lots of people have problems with this company, so maybe there is some promise there. but i don't know, a lawsuit? good luck i suppose!!!! 

[Argwai96]

good luck if you do!!! 

[Gimmelfarb]

I hope someone does! it's pretty messed up, this whole long, drawn out situation!! 

[gump]

I suspect this is a cleverly crafted PONZI scheme, where they are utilizing our funds to develop and utilize technology in order to mine bitcoin (for themselves), while "planning" to ship some to paying customers -- all the while, driving up the difficulty level, so that IF someone gets their devices, they will be essentially worthless for this purpose.   THEY benefit, everyone else loses.

It's very clever, but it's still a PONZI scheme and that is blatantly illegal. 

I recommend those who have been ripped off to file detailed complaints with the FTC and their State's Attorney General, to start.   

It is likely a matter of time before someone at BFL goes to jail.

It's unfortunate, as it really undermines the public's confidence in independent research.

[Anon135246]

Bring them dooooown!

[coincloudno]

We're happy we didn't invest in it. But does anyone suggest a good place to buy those FPGA alternatives?

[zoman2000]

I hope someone does! it's pretty messed up, this whole long, drawn out situation!!  

There is a Law firm investigating to file a suit against BFL.

Technically if you have ordered anything at first discount starting December 2013, and second discount starting January 2014 you have lost ~75% of the value per today. And in neither of the cases your order would qualify for an upgrade.

Check what that company says on their website:
http://www.woodlaw.com/cases/butterfly-labs-and-bf-labs-inc-bitcoin-miners

[apsvinet]

@OP, why don't you post it from an account that doesn't have 1 activity, what are you afraid of?

[Wendigo]

What was the value of 1 btc back in 2012?

[apsvinet]

Nevermind I didn't read the date of this thread.. Someone necro'd it, should've known better. My bad.

[Sonny]

What was the value of 1 btc back in 2012?

It was around $5 in early 2012, and the high was around $15 in Aug 2012.
https://blockchain.info/charts/market-price?timespan=all