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Author Topic: RE-EDIT**EDIT*: How to SAFELY sell Bitcoins on eBay  (Read 21546 times)
johnniewalker
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May 09, 2013, 09:22:27 PM
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**There is always a risk selling digital goods. PayPal was initially the culprit that made it such that I could not sell bitcoins on eBay. That was after I had done A LOT of transactions involving bitcoins. I would bet that if you do one or two transactions selling bitcoins and using PayPal as your accepted Payment method, you'll be ok. But once you start doing more volume (like I was), you appear on PayPal's radar. I honestly think they target volume-sellers to sort of make a statement. Anyway, the important thing to realize is that even though it certainly seems this way, eBay DOES NOT equal PayPal. eBay owns PayPal, pushes it as accepted method of payment, and thus 95% of sellers use it to accept payment. However, PayPal IS NOT the only accepted form of payment by eBay. You can use your credit card merchant account (if you have one), Skrill (owned by PayPal, I believe), ProPay, one more I want to say, and "payment upon [local] pickup". So, so long as PayPal is not your accepted form of payment, my method of selling bitcoins will generally work. All it is really is a system to make sure that someone cannot come back and say they never received the item you sold and sent to them. Scammers are clever though,and constantly coming up with methods to take your money. So, just use common sense and awareness to make sure that you aren't taken by a scammer.**

*This is a safe method if you only use it once or twice. After more than 20 transactions, PayPal has restricted my account, saying that their services cannot be used for currency exchange, check cashing, bitcoins and EVEN Bitcoin COLLECTIBLES (like a redeemed Casascius coin). I am fighting this because, for one thing, the restriction on collectibles is ABSOLUTELY ridiculous. Also, they say they do not allow their services to be used as currency exchanges. Well, all US currency ever produced is STILL legal tender (as is the case with other countries' currency, too). You know how many listings there are for say, Silver Eagles? With a LEGAL TENDER amount of $1? I could buy that with Euros if I wanted to. If thats not a currency exchange, what is it?*

I wanted to write up this guide, but wasn't sure where to put it. I decided here since it offers instruction, and I know not just newbie members check this board.

Anyways, I want to share with you a completely safe way to sell bitcoins on eBay. eBay and PayPal are covered in an aura of taboo in the bitcoin world. That's because-obviously-scammers use those methods to steal from you. And, both PayPal and eBay like the customer, so if you sell bitcoins for PayPal, you get back a nice fat chargeback.
The problem with selling bitcoins on eBay or for PayPal, by strictly sending them electronically is that there is no physical aspect involved. THAT is why PayPal sides with the buyer-they aren't used to selling digital goods, just tangible things. If you sell Bitcoins for PayPal, on eBay or elsewhere, you thus have to have something tangible involved-and if it has tracking, its virtually impossible to get a chargeback.
I have sold a lot of bitcoins on eBay. This is the way I do it: I simply print out a bitcoin bill (go to bitaddress.org, hit "bulk wallet" and under "generate", put the number of keypairs you would like made. 1 bitcoin bill=1 keypair. Then, go to printcoins.com, hit "print your own" and fill in the initial fields with whatever you want-they're just for fun-I put "Bank of Johnniewalker". In the big dialog box, copy and paste the entire keypair from bitaddress.org. Pick a design, then hit "Generate PDF of bills". If you have thicker paper, customers would be more impressed, but if not don't worry, just print the bill.)
NOW you have something tangible. If you sell through eBay, you can mail w/tracking for $1.69.
You tell the customer that once the bill is made, you destroy all data pertaining to it (and you do-don't be a scammer). Thus, once they receive the bitcoin bill (still it has 0 balance) they need to send you a message with the public address of the bill. Once they give it to you, send the funds to the address, go to blockchain.info, enter the public address, and take a screenshot for confirmation of funds sent.

.....aaaaaaand you're done!
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Acesbomb_
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May 09, 2013, 09:22:51 PM
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thanks for this, it helped a lot a newbie like me Cool
SgtSpike
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May 09, 2013, 09:26:06 PM
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I've wondered about this.  So you haven't had much trouble selling these on eBay?  No one has attempted to scam you or dispute the charge?
nuggium
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May 09, 2013, 09:28:33 PM
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Thanks for the tip!  Smiley
Manna
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May 09, 2013, 09:48:20 PM
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good idea, thanks for the tip. Last year I made a small 3 digits loss on ebay because of paypal chargebacks of bitcoins. Learned my lesson Smiley
johnniewalker
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May 09, 2013, 10:03:21 PM
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Never had a problem. But I have to say, I have payed for shipping through eBay, which gives the tracking number to PayPal (you might as well, too-its only like $1.50). PayPal is on the side of the buyer, but limited primarily to  the extent that they have proof the item arrived. They are not concerned if the customer doesn't "like" the product-in that case they would just return it. All you're sending is a worthless piece of paper-why would PayPal believe it if a customer said they received something different?

I can't even tell you how many coins I've sold on there. Usually I do it in like .1, .5 increments. Its GOOD money. People on eBay know about bitcoins, but thats about all they know. They have no idea how to "get" bitcoins. So, they have no problem paying a premium to buy into something they otherwise wouldn't have the knowledge to do.
SgtSpike
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May 09, 2013, 10:04:58 PM
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Never had a problem. But I have to say, I have payed for shipping through eBay, which gives the tracking number to PayPal. PayPal is on the side of the buyer, but limited primarily to  the extent that they have proof the item arrived. They are not concerned if the customer doesn't "like" the product-in that case they would just return it. All you're sending is a worthless piece of paper-why would PayPal believe it if a customer said they received something different?

I can't even tell you how many coins I've sold on there. Usually I do it in like .1, .5 increments. Its GOOD money. People on eBay know about bitcoins, but thats about all they know (they have no idea how to "get" bitcoins. So, they have no problem paying a premium to buy into something they otherwise wouldn't have the knowledge to do).
Well, I like the idea of waiting to fund it until the buyer confirms they have received it.  Seems like a pretty fool-proof way of doing it TBH.
johnniewalker
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May 09, 2013, 10:07:10 PM
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Never had a problem. But I have to say, I have payed for shipping through eBay, which gives the tracking number to PayPal. PayPal is on the side of the buyer, but limited primarily to  the extent that they have proof the item arrived. They are not concerned if the customer doesn't "like" the product-in that case they would just return it. All you're sending is a worthless piece of paper-why would PayPal believe it if a customer said they received something different?

I can't even tell you how many coins I've sold on there. Usually I do it in like .1, .5 increments. Its GOOD money. People on eBay know about bitcoins, but thats about all they know (they have no idea how to "get" bitcoins. So, they have no problem paying a premium to buy into something they otherwise wouldn't have the knowledge to do).
Well, I like the idea of waiting to fund it until the buyer confirms they have received it.  Seems like a pretty fool-proof way of doing it TBH.
Exactly. So you have a record they in-fact received exactly what they paid for. And when you take a screenshot on blockchain thats even further documentation.
DeathAndTaxes
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May 09, 2013, 10:08:33 PM
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It isn't scamproof (nothing is except maybe shipping goods AFTER getting bitcoins Smiley.

ebay allows dispute "not as described".  Ebay will allow the buyer to send the goods back and then will get a full refund.

Pay
Receive
Send photo
Transfer BTC
Dispute
Get money back.


Buyers have been abusing "not as described disputes" for years.  Usually it justs the seller the sale (plus expense and hassle of return, funds on hold, etc).
https://www.paypal-community.com/t5/How-to-use-PayPal-Archive/Buyers-abusing-quot-not-as-described-quot-to-force-refund-when/td-p/15414
johnniewalker
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May 09, 2013, 10:13:14 PM
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It isn't scamproof (nothing is except maybe shipping goods AFTER getting bitcoins Smiley.

ebay allows dispute "not as described".  Ebay will allow the buyer to send the goods back and then will get a full refund.

Pay
Receive
Send photo
Transfer BTC
Dispute
Get money back.


Buyers have been abusing "not as described disputes" for years.  Usually it justs the seller the sale (plus expense and hassle of return, funds on hold, etc).
https://www.paypal-community.com/t5/How-to-use-PayPal-Archive/Buyers-abusing-quot-not-as-described-quot-to-force-refund-when/td-p/15414

That's why they send you a message and you take a screenshot on blockchain. If the customer opens a case that item was "not as described" you have those to show eBay.
DeathAndTaxes
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May 09, 2013, 10:15:56 PM
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It isn't scamproof (nothing is except maybe shipping goods AFTER getting bitcoins Smiley.

ebay allows dispute "not as described".  Ebay will allow the buyer to send the goods back and then will get a full refund.

Pay
Receive
Send photo
Transfer BTC
Dispute
Get money back.


Buyers have been abusing "not as described disputes" for years.  Usually it justs the seller the sale (plus expense and hassle of return, funds on hold, etc).
https://www.paypal-community.com/t5/How-to-use-PayPal-Archive/Buyers-abusing-quot-not-as-described-quot-to-force-refund-when/td-p/15414

That's why they send you a message and you take a screenshot on blockchain. If the customer opens a case that item was "not as described" you have those to show eBay.

Example:
"Dispute: Not a described. Seller claimed he would fund the cert with x Bitcoins but he did not.  I wish to return this worthless cert as it is not as described.  Please help me PayPal I feel the seller is trying to take advantage of people.  I will gladly pay return shipping"

I feel it is dangerous to be advertising a "safe" method of selling on ebay, especially in the noob forum.  While it certainly is safER than do an online transaction it is hardly safe.  Even if you win the dispute, the scammer can just have the credit card company chargeback the funding transaction, and PayPal will reverse it on you in response.  Buyer's protection doesn't cover chargebacks related to "not as described".

Quote
11.5 Items/transactions not eligible for PayPal Seller protection. The following are examples of items/transactions not eligible for PayPal Seller protection.
Claims or Chargebacks for Significantly Not as Described.
Items that you deliver in person, including in connection with In-Store Checkout.
Intangible items, including Digital Goods, and services.
PayPal Direct Payments.
 Virtual Terminal Payments.
PayPal Business Payments.
Items that are not shipped to the recipient's shipping address on the Transaction Details Page. If you originally ship the item to the recipient's shipping address on the Transaction Details Page but the item is later redirected to a different address, you will not be eligible for PayPal Seller protection. We therefore recommend not using a shipping service that is arranged by the buyer, so that you will be able to provide valid proof of
shipping and delivery.

https://cms.paypal.com/us/cgi-bin/?cmd=_render-content&content_ID=ua/UserAgreement_full#11. Protection for Sellers.
SgtSpike
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May 09, 2013, 10:25:43 PM
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Good points as well, DeathandTaxes.

Perhaps covering the private key with a tamper-proof hologram?  Then, the scammer couldn't redeem the coins without ruining the hologram, and the seller could refuse a refund stating that the buyer didn't return the item as it was sold.

At that point, it'd be a his word vs my word thing as far as who did what.  How do those disputes with a brick sent instead of a laptop usually work out?
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May 09, 2013, 10:34:29 PM
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Good points as well, DeathandTaxes.

Perhaps covering the private key with a tamper-proof hologram?  Then, the scammer couldn't redeem the coins without ruining the hologram, and the seller could refuse a refund stating that the buyer didn't return the item as it was sold. 

That would up the stakes but as you point out, PayPal will have buyer return it you will get it back with damaged hologram.  Buyer will claim it was intact when he sent it.  Seller will claim it was damaged when it was received. 

At which point as you said it becomes he-said she-said.  The bad news is that a single seller will attract multiple scammers so while someone might win the first one dispute, the subsequent cases (by different scammers) are going to suddenly start looking bad for the seller.

Quote
At that point, it'd be a his word vs my word thing as far as who did what.

Now if PayPal gave sellers an option to require the item be returned NOT to seller but to PayPal (or a third party contracted by PayPal) for inspection well that would be a foolproof system.   Sadly PayPal doesn't offer that as an option. 

If they did the combination of:
a) sold unfunded
b) tamper resistant packaging
c) user providing photo of received contents
d) inspection by third party in case of disputes

would be pretty much the holy grail.

Quote
How do those disputes with a brick sent instead of a laptop usually work out?

I have heard examples of it going either way:
Scammer claims to have gotten a brick, returns a brick and wins dispute.
Scammer sends a brick, claims buyer is lying, and wins dispute.

Buyer always has upper hand unless they are using PayPal funds because they can dispute it again with credit card company.
MiningUnited
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May 09, 2013, 11:38:27 PM
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Quote
I have sold a lot of bitcoins on eBay. This is the way I do it: I simply print out a bitcoin bill (go to bitaddress.org, hit "bulk wallet" and under "generate", put the number of keypairs you would like made. 1 bitcoin bill=1 keypair. Then, go to printcoins.com, hit "print your own" and fill in the initial fields with whatever you want-they're just for fun-I put "Bank of Johnniewalker". In the big dialog box, copy and paste the entire keypair from bitaddress.org. Pick a design, then hit "Generate PDF of bills". If you have thicker paper, customers would be more impressed, but if not don't worry, just print the bill.)

While this is a much 'safer' way to do things, the sale of BitCoin is flat out against PayPal's policy. It may be longer to get 'caught', but you will eventually get buyers that will try to scam you. When they cry to PayPal they will see that you are selling BitCoins, then, game over.
deserir
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May 09, 2013, 11:58:52 PM
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good idea, thanks for the tip. Last year I made a small 3 digits loss on ebay because of paypal chargebacks of bitcoins. Learned my lesson
MiningUnited
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May 10, 2013, 12:02:50 AM
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Quote
good idea, thanks for the tip. Last year I made a small 3 digits loss on ebay because of paypal chargebacks of bitcoins. Learned my lesson

It was bad even a year ago?

If PayPal is an 'eBay company', and if PayPal does not allow the sale of BitCoin, then why doesn't eBay prevent its sale? There is no restriction at all for selling BitCoin on eBay, only with using PayPal for the payment.

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May 10, 2013, 12:07:59 AM
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If it involves paypal/ebay it is inherently unsafe, due to the above mentioned reasons.
There really is nothing you can put in place that makes is safe.

Using a well known Bitcoin exchanges (in you country) or private sales with known trusted users is really the only way to go.

I known you tried with this guide, but it's still a place where so many get scammed, it is best to just avoid using it entirely.


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MiningUnited
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May 10, 2013, 12:10:23 AM
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I known you tried with this guide, but it's still a place where so many get scammed, it is best to just avoid using it entirely.

What attracts so many sellers to eBay for example is the high markup price they can sell for. Browse the sold listings and you can see sales with over +$50-150 markup.
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May 10, 2013, 12:13:50 AM
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Quote
good idea, thanks for the tip. Last year I made a small 3 digits loss on ebay because of paypal chargebacks of bitcoins. Learned my lesson

It was bad even a year ago?

If PayPal is an 'eBay company', and if PayPal does not allow the sale of BitCoin, then why doesn't eBay prevent its sale? There is no restriction at all for selling BitCoin on eBay, only with using PayPal for the payment.



Any restriction on PayPal is defacto a restriction on ebay as you MUST accept PayPal as a condition of listing on ebay.  Just because ebay doesn't kill every listing within seconds doesn't mean they support it.  There are something like 20 million auctions on ebay at any particular time.  It simply isn't cost effective to monitor them all continually.

It would be like a cop stops you for speeding 75 in a 60.  You say to the cop "if speeding is illegal then why didn't someone stop me yesterday when I was speeding?  Obviously you must be incorrect and speeding is not illegal"  Smiley
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May 10, 2013, 12:14:42 AM
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Quote
I known you tried with this guide, but it's still a place where so many get scammed, it is best to just avoid using it entirely.

What attracts so many sellers to eBay for example is the high markup price they can sell for. Browse the sold listings and you can see sales with over +$50-150 markup.

... and end up -$50 to -$100 after chargebacks.
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