[CANCELLED & REFUNDED] Brand New Radeon HD 5830 1GB

[joulesbeef]

I doubt it, the bids will probably happen in a flurry when 2-3 people start, and then end 24 hours after the flurry.

why? it only costs .25 to "bid".. which isnt really a bid at all but each person paying to beat the person behind them.

this thing will get until there is a bid every 23.90 hours.. the "seller" will have a constant flow of 0.25 coins every 24 hours or so and never have to give up the card, cause it doesnt matter how high the top bid is.. it only takes 0.25 to top it.

heck i could keep everyone from getting the card or the coin EVER by sending this guy money every 23 hours. See the problem yet? everyone want to be last but there is no last. as long as there are new bitcoin holders.

I just cant believe he sucked 5 people into paying.. yes i really hope one of them is he last and even though I would love this card and really could use it, I would never send him .25.. it's  fools game.

[JoelKatz]

Any auction where you pay to bid and cannot set the amount of your bid is a scam.

All he has to do is place his own bid from another account any time someone else might win the video card for less than its fair market value. Eventually, he'll either be way over the fair market value in profits and let someone 'win' or he'll win himself.

[Reikoku]

I'm sorry if people think that it's a scam, I've dealt several thousand dollars over this forum / OTC and don't plan on scamming someone over 11 Bitcoin. It seems to be generating a lot of controversy, more than I expected, and not an awful lot of bids, which is not what I expected.

The issue with having everyone acknowledge making a bid is that it breaks a lot of the anonymity of Bitcoin. It allows anyone watching Blockexplorer to identify addresses and sources of Bitcoin to individual users, which cannot possibly be a good thing for privacy, one of Bitcoin's most attractive factors.

heck i could keep everyone from getting the card or the coin EVER by sending this guy money every 23 hours. See the problem yet? everyone want to be last but there is no last. as long as there are new bitcoin holders.

Why would you want to keep sending me coins to prevent someone else from getting any? It doesn't make any commercial sense.

All he has to do is place his own bid from another account any time someone else might win the video card for less than its fair market value.

This vulnerability isn't unique to penny auctions. If I wanted to bid up my own auction on eBay, all I need is a second account or a friend who's willing to cheat the system. All sales require a level of trust between buyer and seller.

I repeat, I've done several thousand dollars of trade through this forum and the OTC IRC, I don't intend to scam anybody.

If every bidder so far agrees to a refund (I'm pretty sure I know who two of the bidders are), I will quite happily end and cancel the auction as I don't think my commercial experiment has worked how I wanted it to. If any of them don't agree then I can't really do it because it wouldn't be fair.

[Littleshop]

This vulnerability isn't unique to penny auctions. If I wanted to bid up my own auction on eBay, all I need is a second account or a friend who's willing to cheat the system. All sales require a level of trust between buyer and seller.

No, it is not even close to the same.  On Ebay if you did that you do not get to keep profits from the loosing bids.  While there is an incentive to try to get a higher price on ebay there is a pitfall of 'wining' your own auction and getting NO money.  Also ebay is now better at punishing shill bidders by detecting and closing BOTH accounts. 

If you place fake bids on your own penny auction you get to keep all of the other real bidders money.

[Reikoku]

This vulnerability isn't unique to penny auctions. If I wanted to bid up my own auction on eBay, all I need is a second account or a friend who's willing to cheat the system. All sales require a level of trust between buyer and seller.

No, it is not even close to the same.  On Ebay if you did that you do not get to keep profits from the loosing bids.  While there is an incentive to try to get a higher price on ebay there is a pitfall of 'wining' your own auction and getting NO money.  Also ebay is now better at punishing shill bidders by detecting and closing BOTH accounts.  

If you place fake bids on your own penny auction you get to keep all of the other real bidders money.

Fair point.

If you can think of a way to secure it so that I can prove that I'm not doing this, I'd be open to trying it. I'm not trying to scam anyone, I don't want to scam anyone. I like to think I have a pretty positive reputation here and I don't want to damage it.

[jwzguy]

You've already damaged it. PAY TO BID AUCTIONS ARE A KNOWN SCAM.

You can protest as much as you want, as long as you are running a KNOWN SCAM you are a scammer. Shut it down and give anyone who bid double their money back (would be very little at this point), then maybe you will have some credibility.

[Smalleyster]

If you can think of a way to secure it so that I can prove that I'm not doing this, I'd be open to trying it. I'm not trying to scam anyone, I don't want to scam anyone. I like to think I have a pretty positive reputation here and I don't want to damage it.

Very simple, run a fair and open auction where one does not have to pay to bid.

Other than that you have an extremely negative reputation based on trying this scam.

[SmokeAndMirrors]

I don't think he's trying to scam anyone. It's a pretty simple idea that involves a card and people throwing a few BTC until everyone forgets about it, resulting in a winner. In my opinion, it's relative to the "hand on the car" game, if you're the type to suggest that time >= money.

Regardless of the fact that it *could* go on forever, it's still a chance at getting the card if people slip up and forget to check how much time's left. I personally think that the game is flawed in the sense that it resets for 24 full hours, otherwise I would give it a shot.

[Jack of Diamonds]

I'd agree with Smalleyster, penny auctions fill every aspect of a scam. They are even illegal in some countries.

Only with bitcoins, you don't even need proxies or dummy accounts.
Just keep padding the price with your own money while waiting for suckers to send in theirs.

[Reikoku]

Due to the sheer amount of controversy this has caused, I've decided to shut it down.

I don't think that penny auctions are a scam, but I do accept that there are far too many ways for me to have deceived people in the way this one was operated.

I thought long and hard about refunds and how best to do them, the doubling each refund above was appealing, but it didn't allow me to give out the 11 BTC which was what the winner had been promised.

I'm going to refund every bidder except the most recent with 0.25 BTC, and send the winnings of 11 BTC to the most recent bidder (1AQDgdT6Jmu642wVCF8ayPfdKfNghnfLzA). This means that the most recent winner will be paid 11 BTC, the rest will get their bids back and my losses are capped at 11 BTC.

BlockExplorer links for refunds:
Bidder 1 - Link
Bidder 2 - Link
Bidder 3 - Link
Bidder 4 - Link
Bidder 5 - Link
Bidder 6 - Link
Winner - Later

This has been a learning experience and although I'm down 11 BTC, I think I've gained some knowledge about the reaction of the forum to penny auctions, some of the weaknesses in it which are very hard to do securely, and how to better trade in future. For this, I think it's a fair price to pay.

Hopefully it will also show that I'm not a cheap profiteer and I'm not going to abuse the Bitcoin community which I enjoy being a part of. I was just trying a new commercial model and the resounding reply was that it doesn't work

If the winner wants the Radeon 5830, they can send me 12 BTC back (as originally said) to cover shipping anywhere in the world, and I'll send it to them.

[DonnyCMU]

Anyone else think this is a scam???

SCAM! SCAM! SCAM!

Now many people around here starts calling things they don't like a scam.

Bidding-fee auction is NOT a scam. It is just a model of gambling.
But the business is prone to abuse from the guy who runs it. In most cases, this is very hard to verify by bidders. So, it is possible that it MAY be scam, depending on how it's run and the guy who runs it.

Still think it's a scam?
Ok... Um... Buying Bitcoins with Paypal? SCAM!!! SCAMMER!! GTFO!

.....Hell No! Buying Bitcoins with Paypal  <--- NOT scam
Buying Bitcoins with Paypal and file chargeback after receiving Bitcoin <--- SCAM


For this thread and this auction, making the bidders anonymous will make the whole thing more prone to be scammed. However, I saw the OP in the community for quite a long time, and is certain to some point that he won't scam. I was preparing to come and make a bid after about 10+ bids, for the competition to sorta 'died out' or given up. Too bad it got canceled. If the auction require each bidder to show themselves in the thread AND have bidding requirement of 20+ posts to make a bid, perhaps it won't stir such controversy.

Kudos to the OP for refunding everything AND also give away the big prize. It's quite a loss.

People, you can sorta see your reflections when you see people who just learn about Bitcoin coming to this forum and call Bitcoin a big scam.

[deslok]

Disappointed the big prize wasn't split among the bidders but I threw in my quarter coin and got it back more than I expected to be honest.

[Smalleyster]

Due to the sheer amount of controversy this has caused, I've decided to shut it down.

You did good sir!

Thank you.

[PandaMiner]

He did the "right" thing. Will the "winner" be as kind?

[Reikoku]

He did the "right" thing. Will the "winner" be as kind?

I don't mind what the winner does. If he wants the Radeon he'll have to tell me who he is.

Disappointed the big prize wasn't split among the bidders but I threw in my quarter coin and got it back more than I expected to be honest.

Sorry about that. It was one option but I figured by offering it all at once I wasn't lying about the auction as the winner still got to 'win', by refunding everyone else I made sure they didn't lose anything.

I'd agree with Smalleyster, penny auctions fill every aspect of a scam. They are even illegal in some countries.

I take most of your points, but illegality shouldn't be a measure of legitimacy. Lotteries and sports betting are illegal in many countries, but they aren't a scam. They make the business running them a profit, but so do most services and products, so that's not a measure of a scam.

Bidding-fee auction is NOT a scam. It is just a model of gambling.
But the business is prone to abuse from the guy who runs it. In most cases, this is very hard to verify by bidders. So, it is possible that it MAY be scam, depending on how it's run and the guy who runs it.

Thanks for the support, of course you're right, there's no way I'd scam people especially for 11 BTC, but it's easy to see why people could think it's a scam. Unfortunately the model is very hard to verify and doesn't seem to be overly popular here. I was trying to find something worth offering to the community and this doesn't seem to be it.

Thanks everyone who participated, everyone who criticised and everyone who supported me. Hopefully this can be a good learning experience for all of us.

[shakaru]

I love how the people not willing to fork up any money are the ones who cry about this, not thoese actually involved.

Oh and to the guy who said that pay to bid auctions are a scam. So the Xbox360 with Kinect I got for under $20 usd is a figment of my imagination? I bet that $3 lightsaber also dosent exist. Pay to bid auctions are a good thing, if you are into them. Your logic equates to that of someone crying over a lost bet at a casino. You have no promise of any return and the rules are laid out pain and simple. A regular auction works the same way, but the price gets inflated by bids that people have no intention of honoring and a relived when they get overtaken. If your worried about this sort of thing, then maybe Bitcoin isnt for you.

Fact of the matter, Reikoku is a pillar of this community. His mining contracts and other public dealings have been a part of this forum for as long as I can recall. I have not once heard of any negitive feedback, or any reason to doubt his intentions. Anyone who stumbles across this topic should know that about Reikoku and not let this form negitive opponion about him.
Good luck to you.

[d.james]

The biggest issue about your penny auction is:
the seller can "cheat" to prolong the auction indefinitely.

Now that I know you probably aren't doing it, but there's no way for others to know.
Anyways, good decision to end this.

[Reikoku]

I love how the people not willing to fork up any money are the ones who cry about this, not thoese actually involved.

Oh and to the guy who said that pay to bid auctions are a scam. So the Xbox360 with Kinect I got for under $20 usd is a figment of my imagination? I bet that $3 lightsaber also dosent exist. Pay to bid auctions are a good thing, if you are into them. Your logic equates to that of someone crying over a lost bet at a casino. You have no promise of any return and the rules are laid out pain and simple. A regular auction works the same way, but the price gets inflated by bids that people have no intention of honoring and a relived when they get overtaken. If your worried about this sort of thing, then maybe Bitcoin isnt for you.

Fact of the matter, Reikoku is a pillar of this community. His mining contracts and other public dealings have been a part of this forum for as long as I can recall. I have not once heard of any negitive feedback, or any reason to doubt his intentions. Anyone who stumbles across this topic should know that about Reikoku and not let this form negitive opponion about him.
Good luck to you.

Thanks for the support Shakaru, yeah I won an iPhone 4 for 4 euros and a 0.35 final bid so I'm not against these at all either. It's a bit of a gamble, but ultimately as long as the seller is clear at the outset, and the buyers understand how it works, I don't think it's a bad thing.

Ultimately the community has spoken, and I can understand their fears. Reputation alone doesn't prove anything, just look at FoodStamp. I think the only way to make this work would be through a signup-based site and on faster timers, and that would require far more users to know about it and be interested in it than currently are.