I'm done with Bitcoin Securities...

[mgio]

First, I lose 50+ BTC to Labcoin
Then, 250+ coins to Bitfunder/ukyo.loan
Finally, 100+coins to Neo&Bee

Labcoin definitely was a scam. There isn't even enough information about the other two to make a determination as to what happened!

Bitcoin securities are just faaar too risky and there is no regulation and no protection. You might as well just throw your bitcoins away.

The SEC is investigating all of the above (well, I'm not sure about Labcoin), but by the time they get around to going after them, that money will probably be long gone.

btw, bitcoin mining is also a scam. BFL, Avalon, HashFast, etc... pretty much every company has cheated their customers and there is NO RECOURSE.

This simulator may be a joke, but it is actually pretty accurate: http://www.beepboopbitcoin.com/

All of these scams are very bad for bitcoin and from now on, I'm just going to sit and hold my coins.

[OgNasty]

First, I lose 50+ BTC to Labcoin
Then, 250+ coins to Bitfunder/ukyo.loan
Finally, 100+coins to Neo&Bee

It is unfortunate that you have had such bad luck.  You should research and keep an eye on your funds a little better though.  Labcoin & Neo seemed like easily spottable scams and the writing was on the wall about ukyo.loan.  I was personally buying up ukyo.loan like crazy, but once it was obvious that they would never be repaid there was plenty of opportunity to sell at near the purchase price before BitFunder closed shop.

If you would like to see an organization that is transparent and not run by a scammer, check out some of the things I've been up to with NastyFans.  We aren't all bad.

[OgNasty]

Didn't you use to run a pirate passthrough?

For a short time I ran an insured deposit program.  Nearly everyone who participated (over 90%) got out with significant gains, but the few who stayed in through the collapse were paid their insured amounts and were quite satisfied, as most of them were already in the green at that point as well.  I would say I ran the only one that didn't burn anyone and I was 100% open about the entire thing.  There was nothing dishonest about what I did and I'm surprised you would insinuate as much.

[roslinpl]

First, I lose 50+ BTC to Labcoin
Then, 250+ coins to Bitfunder/ukyo.loan
Finally, 100+coins to Neo&Bee

Labcoin definitely was a scam. There isn't even enough information about the other two to make a determination as to what happened!

Bitcoin securities are just faaar too risky and there is no regulation and no protection. You might as well just throw your bitcoins away.

The SEC is investigating all of the above (well, I'm not sure about Labcoin), but by the time they get around to going after them, that money will probably be long gone.

btw, bitcoin mining is also a scam. BFL, Avalon, HashFast, etc... pretty much every company has cheated their customers and there is NO RECOURSE.

This simulator may be a joke, but it is actually pretty accurate: http://www.beepboopbitcoin.com/

All of these scams are very bad for bitcoin and from now on, I'm just going to sit and hold my coins.

... not good statistics but do not worry
Just try to avoid scam next time

Sorry for your lost.

[mgio]

First, I lose 50+ BTC to Labcoin
Then, 250+ coins to Bitfunder/ukyo.loan
Finally, 100+coins to Neo&Bee

It is unfortunate that you have had such bad luck.  You should research and keep an eye on your funds a little better though.  Labcoin & Neo seemed like easily spottable scams and the writing was on the wall about ukyo.loan.  I was personally buying up ukyo.loan like crazy, but once it was obvious that they would never be repaid there was plenty of opportunity to sell at near the purchase price before BitFunder closed shop.

If you would like to see an organization that is transparent and not run by a scammer, check out some of the things I've been up to with NastyFans.  We aren't all bad.

I'm curious how you were able to get out of ukyo.loan in time. Even if I had sold I would have never seen a single bitcoin as weexchange was "broken" and did not process bitcoin withdrawals for a couple of months before Bitfunder actually shut down. And there never was enough liquidity for me to sell, really. I owned 25,000 shares which was 1/8 of the total outstanding shares. I requested a redemption as soon as it looked like bitfunder was having problems. I never got any redeemed. I haven't given up on ukyo, but really, only because I have no other choice. I've been talking to my lawyer but I'm looking for a resolution that doesn't involve suing ukyo, forcing him into personal bankruptcy, and picking up whatever scraps remain.

The funny thing is that I invested in ukyo.loan and xbond because they looked like far safer investments than all the bitcoin securities out there. I figured as long as bitfunder still existed, they both would be paying dividends. I should have bailed once I saw the BTCT was being shut down and realized that Bitfunder was going to follow soon after.

With Labcoin, I originally had planned on getting in on the IPO and selling right away. I would have tripled my 50 coin investment and made 100 coins in a couple of hours. But BTCT was bugged and I couldn't actually purchase anything. Yes, I know. I was one of those horrible speculators that wanted to get in early. ride the wave up, and get out. Even though that did not work out for me, I bought after the IPO anyways and fell for the hype. And held and held until the shares were worthless.

Neo&Bee looked risky, but legitimate to me. I don't think it was an obvious scam. Maybe extremely poorly run, but not on outright scam. With no accountability in bitcoin, *everything* might as well be a scam. I bought my shares directly with my xbond shares which gave me a discount. At the time, 100 BTC I spent were only worth about $10k so it didn't seem like that huge of an investment.

It wasn't all a loss for me though. ASICMiner was a HUGE win for me. And I was able to get out of XBOND before the bonds were recalled. Everything since those two had been a bust.

Looking back, I was very naive and I'd be a fool to continue to invest in bitcoin securities.

[velacreations]

AM was a mining operation that wasn't a scam.

And, if I may ask, what makes you think the SEC is investigating Bitfunder and/or Neo?

I agree that this industry is filled with scams, but many have said that a problem like this is really an opportunity in disguise.  The trick is to figure out how to provide protection for investors and provide an open market for valid securities.  Maybe a rating agency or escrow or insurance? 

[mgio]

AM was a mining operation that wasn't a scam.

And, if I may ask, what makes you think the SEC is investigating Bitfunder and/or Neo?

I agree that this industry is filled with scams, but many have said that a problem like this is really an opportunity in disguise.  The trick is to figure out how to provide protection for investors and provide an open market for valid securities.  Maybe a rating agency or escrow or insurance? 

AM was not a scam at all, I agree. But several other mining companies were scams. There are more horrible investments than good ones and it seems to be shifting more and more in that direction.

They've called me on the phone, primarily regarding Bitfunder but they read these forums and they are aware of everything that is going on here.

Yes, a rating agency or insurance or something would be a good start. But probably not enough.

[NotoriousBIT]

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[velacreations]

They've called me on the phone, primarily regarding Bitfunder but they read these forums and they are aware of everything that is going on here.

The SEC called you on the phone and said they were investigating BF and Neo?  How did they get your number?

Yes, a rating agency or insurance or something would be a good start. But probably not enough.

maybe not, but it might be better.  If you had it tied with an exchange that only listed credible operations, then it might help to reduce the number of scams.  Maybe.  There's certainly a need for something better, which means to me that there is a business opportunity, just have to figure out how to make it work.

[NotLambchop]

...
Yes, a rating agency or insurance or something...
...

Both rolled into one --  PatrickHarnett!

[mgio]

They've called me on the phone, primarily regarding Bitfunder but they read these forums and they are aware of everything that is going on here.

The SEC called you on the phone and said they were investigating BF and Neo?  How did they get your number?

Yes, a rating agency or insurance or something would be a good start. But probably not enough.

maybe not, but it might be better.  If you had it tied with an exchange that only listed credible operations, then it might help to reduce the number of scams.  Maybe.  There's certainly a need for something better, which means to me that there is a business opportunity, just have to figure out how to make it work.

They googled me. It's not too hard to get someone's number unless that person is intentionally trying to hide.

The problem is that there is no accountability. Maybe some of these scams aren't scams at first. Maybe Labcoin actually was trying to develop hardware and then they realized it was too difficult/expensive to do and they just said "screw it, let's take the money and run".

[velacreations]

They googled me. It's not too hard to get someone's number unless that person is intentionally trying to hide.

the SEC is using google?  oh damn, MP is screwed.

The problem is that there is no accountability. Maybe some of these scams aren't scams at first. Maybe Labcoin actually was trying to develop hardware and then they realized it was too difficult/expensive to do and they just said "screw it, let's take the money and run".

yeah, unfortunately, you're right.  Accountability is difficult.  We all know who Mark Karpeles is, and yet he still gets away with fraud. I'm not sure how you handle that side of it, without just holding the raised funds in escrow and only releasing small amounts at a time, based on agreed milestone completitions.

[OgNasty]

I'm curious how you were able to get out of ukyo.loan in time. Even if I had sold I would have never seen a single bitcoin as weexchange was "broken" and did not process bitcoin withdrawals for a couple of months before Bitfunder actually shut down. And there never was enough liquidity for me to sell, really. I owned 25,000 shares which was 1/8 of the total outstanding shares. I requested a redemption as soon as it looked like bitfunder was having problems. I never got any redeemed. I haven't given up on ukyo, but really, only because I have no other choice. I've been talking to my lawyer but I'm looking for a resolution that doesn't involve suing ukyo, forcing him into personal bankruptcy, and picking up whatever scraps remain.

The funny thing is that I invested in ukyo.loan and xbond because they looked like far safer investments than all the bitcoin securities out there. I figured as long as bitfunder still existed, they both would be paying dividends. I should have bailed once I saw the BTCT was being shut down and realized that Bitfunder was going to follow soon after.

When I saw ukyo.loan suddenly go from trading at a 6% premium to a 5% discount, I knew something was up.  I immediately asked ukyo for a redemption and when I saw he had logged in but wouldn't answer my questions or redeem my shares, I started selling any time it hit the redemption price (same with graet.loan).  This was weeks before weexchange was broken.  I only had ~2,000 shares, so it wasn't too difficult for me to get out, but the writing was most definitely on the wall for days/weeks before the funds became lost.

I invested in ukyo.loan for the same reasons.  It seemed like an obvious choice for the safest bet on the exchange.  I have since avoided any centralized exchange as they will remain SEC targets as long as they keep pretending to be legitimate exchanges with contracts and act as banks holding user funds.  I believe any website that takes deposits of your funds and holds them online as if they were a bank but are unlicensed to transmit money will be shut down eventually.  I think that will just leave AsicMiner, NastyFans, & gigamining...  If there are others that have broken free of centralized exchanges that I have missed, please feel free to mention them.

[glendall]

Wow! That is a lot of money to lose. I'm really sorry for your loss man, that sucks.  I know the feeling (on a much smaller scale anyways).

Losing money in bitcoin has turned me off of the bitcoin economy.  Now I'm only going to buy and hold and do a few minor trades for other new coins I like.  But what, 75%+ or more of exchanges have gone under taking everyone's money, and most of the securities have been a wash.  It's one thing to lose money investing in a product or service that loses value, but it hurts 100x more to lose money to scamming thieves, such as Bitfunder/WeExchange Jon Monroll, who I hope dies soon.

Until we have decentralized exchanges with open source software I think anyone is better off just buying  or mining bitcoins and holding them. There are just too many people who see Bitcoin as a way to personally enrich themselves by stealing from others, such as Jon Montroll.

[dexX7]

well, I'm not sure about Labcoin

FYI: https://bitcointalk.org/index.php?topic=325431.msg5035462#msg5035462 ("The criminal complaint against Labcoin was filed on Friday to the Polizia Postale")

[velacreations]

well, I'm not sure about Labcoin

FYI: https://bitcointalk.org/index.php?topic=325431.msg5035462#msg5035462 ("The criminal complaint against Labcoin was filed on Friday to the Polizia Postale")

damn took them long enough, didn't it?

edit: oh wait, just saw that was posted in Feb.  Still, took much longer than it should have.

[MonkeyBear68]

I do not blame you one bit. Those suggesting that NEO-BEE was an obvious scam either are insiders that are in on it, or they are just spouting off rubbish. This does however highlight a problem with Bitcoin Securities in that there is little recourse once these come to light. All the due diligence in the world cannot protect you from a clever liar. This is why we need the heavy hand of government to start regulating these Bitcoin securities.

Libertarians are deluding themselves if they think a world with minimal government would function. Such a world would be very inefficient for investors and we all would be spending large amounts of time on due diligence for each of our funds only to find out we have been lied to anyway. Investors would soon all become leery due to high amounts of fraud and losses, and investment capital would dry up. Investors would retreat and progress would suffer.

Even with overseers fraud still occurs (Madoff), but on a much smaller percentage overall scale than with Bitcoin securities. I too will not be putting any further BTC into Bitcoin Securities until there is some better and proven vetting process in place. No process is 100% effective, but until Bitcoin Securities approach an acceptable level of trust through vetting by a commission it seems too risky to consider investing in them.

[dexX7]

edit: oh wait, just saw that was posted in Feb.  Still, took much longer than it should have.

The "action" itself started at the beginning of Nov 2013. After then an appropriate lawyer was chosen, information from shareholders collected, the complaint written.. etc.

[mgio]

I do not blame you one bit. Those suggesting that NEO-BEE was an obvious scam either are insiders that are in on it, or they are just spouting off rubbish. This does however highlight a problem with Bitcoin Securities in that there is little recourse once these come to light. All the due diligence in the world cannot protect you from a clever liar. This is why we need the heavy hand of government to start regulating these Bitcoin securities.

Libertarians are deluding themselves if they think a world with minimal government would function. Such a world would be very inefficient for investors and we all would be spending large amounts of time on due diligence for each of our funds only to find out we have been lied to anyway. Investors would soon all become leery due to high amounts of fraud and losses, and investment capital would dry up. Investors would retreat and progress would suffer.

Even with overseers fraud still occurs (Madoff), but on a much smaller percentage overall scale than with Bitcoin securities. I too will not be putting any further BTC into Bitcoin Securities until there is some better and proven vetting process in place. No process is 100% effective, but until Bitcoin Securities approach an acceptable level of trust through vetting by a commission it seems too risky to consider investing in them.

Well said. This is the point I was trying to make.

In the meantime, I'm sorry for implying Neo&Bee was a scam. Mismanaged, maybe, and definitely in bad shape right now, but I don't feel it was a straight-up scam like, say, Labcoin apparently was.

[OgNasty]

I'm shocked that even in hindsight people don't see the signs...  Reputations are earned through time and honest dealings, not with identifications and promises.