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An In-Depth Look at how Butterfly Labs is Going to Lose in Court to the FTC

Buttcoin/ Crime/ Editorial

An In-Depth Look at how Butterfly Labs is Going to Lose in Court to the FTC

Nicsho BFL, bitcoin, buttcoin, Butterfly Labs, fraud, FTC, scam 4 Comments October 14, 2014

UPDATE: Butterfly Labs Motion to Dismiss has been denied, presumably because they broke some rule on page limits. We should take that as their rant (covered below) was too long for THE MAN to take.

The Federal Trade Commission filed Case “4:14-cv-00815-BCW” on September 15th, 2014. In their report, the FTC claims that BFL did a bunch of dumb things. These include:

–Refusing to refund payment, by flipping between two policies: No refunds, and refund offers that were never fulfilled.
–Josh Zerlan, Vice President of Product Development, testified that BFL used pre-paid rigs to mine for BTC before shipping (if they were even shipped). This may explain why some were broken messes by the time they got to customers.
–Because the products were shipped so late (or not at all), the rigs were incredibly outdated, and because of that, miners couldn’t use the rigs properly.  (Via FTC):FTC_2
–Refusing to ship the BitForce miner months after pre-orders, then using deceptive marketing to get people to buy or upgrade to a newer miner, the Monarch.

For these reasons, primarily, the FTC had temporarily shut down operations at Butterfly Labs (From what I understand, some operations have since resumed after a TRO elapsed. More on that later). The FTC has said in their later report:

Read More

Reddit community shows its love for the Bitcoin documentary “The Rise and Rise of Bitcoin”

Buttcoin/ Reddit

Reddit community shows its love for the Bitcoin documentary “The Rise and Rise of Bitcoin”

Buttcoin bitcoin dvd, cheap, lame, pirate 3 Comments October 9, 2014

Bitcoin documentary “The Rise and Rise of Bitcoin” finally came out after numerous delays and attempted community revolts. Reddit is thrilled that this important new piece of Bitcoin history has been crafted and intends to fully support the artist and everyone who dedicated the past 2 years on this project.

Woo! Free Shit!

No wait, they just want free shit and the “tipping economy” is is an entire joke.

 

The comments on the torrent page are just as wonderful

TPB Comments

I am the Bearwhale, goo goo g’joob

Buttcoin

I am the Bearwhale, goo goo g’joob

killhamster bitcoin, buttcoin, sperg, stupid, weird 1 Comment October 7, 2014

I have no idea what the hell a “bearwhale” is supposed to be because I don’t closely enough study these weird supernerds, but here is a bunch of utterly bizarre Bitcoin cult imagery (click to enlarge):

 






 

In conclusion:

uncurable mlady posted:
I think Bitcoin enthusiasts might be dumb.

 

Butterfly Labs is fucked

Buttcoin/ Captains of Industry/ Crime/ Scams

Butterfly Labs is fucked

killhamster BFL, bitcoin, buttcoin, Butterfly Labs 1 Comment October 6, 2014

Just like the title says. Logs and depositions are coming out showing how much BFL did to defraud customers, other companies, banks, and whatever else. Some highlights:

 

BFLfucked03

See below

M4J11vT

HOW CAN I GET ONE OF THESE

BFLfucked04

I can single-handedly build a house faster than it takes for BFL to ship.

BFLfucked02

“Box of fans” is apparently an official BFL product

BFLfucked01

Yes what is “structuring“?

 

You can find more of these wonderful and amazing documents here and here.

UPDATED:

evilweasel posted:
interim order:

https://www.documentcloud.org/docum…17531-54-0.html

there’s a lot of boilerplate bullshit but the very short version is they can ship out already paid for and finished machines, provided the customer wants them and not a refund, but that’s about it, and in 35 days they can submit a business plan to try to let BFL continue as a going company. this order is the FTC getting everything they wanted, in practice.

the slightly longer version:

1)they are forbidden from taking pre-orders
2)they can’t even think about touching any money or property of bfl, except to turn it over to the receiver
3)every single ‘defendant’ (bfl AND three of the heads) must bring every asset they own into the US and disclose it to the receiver. every asset, not just ones they might have stolen from bfl
4)every single defendant must also provide a complete financial accounting to the receiver – again, of their personal stuff as well
5)the temporary receiver stays in control and can do whatever the fuck he thinks is best
6)bfl can ship machines to people who want a machine but not a refund

without an order from the court:
7)bfl is prohibited from “burn-in” testing
8)bfl CANNOT make refunds
9)bfl can’t make any new sales at all

now, they have 35 days to come up with a business plan that:
1)replaces burn-in testing or justifies and discloses it (and what they’ll do with the money)
2)protects customers and their refund rights
3)lets it keep going as a business

my money is on that business plan gets laughed out of court and the company gets liquidated

 

FCKGW posted:
from reddit:

There are some other intersting items in there
1) No refunds to be issued until audited financial statements are submitted to the court and calculation of assests vs liabilities. They only have 1.2 million in cash on hand and owe ?? from pre-paid orders wanting refunds. Likely to be calculated using the FTCs anyone who wants a refund can request one regardless of BFLs sketchy limitaions.
2) All holdings in Bitcoin to be converted to USD as soon as practical at sub $400 each probably
3) Work by BFL principals is unpaid
4) Business plan will likely require BFL to produce new miners upfront and sell only those units already produced.
5) The principal outside the US doesnt appear to be cooperating with the court / receiver
Seems highly unlikely that BFL and its principals have the capital to cover the liabilities re: refunds let alone front the cost to develop & produce new equipment prior to sale.

 

…! posted:
The entire order is fascinating. It freezes not just the assets of the company, but also the personal assets of Sonny and Jody. They basically have to ask permission from the temporary receiver to buy just about anything.

It also requires BFL to transfer all of their bitcoins to a court-operated wallet. They’ll be exchanged for USD, which will likely go to benefit the victimized customers. I wonder what the “my bitcoins literally cannot be taken away from me by any government unless I so choose” bitcoiners will make of this.

BTC as seen on TV

Buttcoin/ Captains of Industry/ Reddit

BTC as seen on TV

killhamster bitcoin, buttcoin, funny 0 Comment October 4, 2014

Recently a bitcoiner asked /r/bitcoin for ideas for a television commercial for Bitcoin. The results were predictably awful. Thankfully, SA forums goon Ghostlight gave them a helping hand:

BTCcommercialLossy

Alert. Pay-Attention: A laugh was mined that was too big for Buttcoin.org to process

Buttcoin

Alert. Pay-Attention: A laugh was mined that was too big for Buttcoin.org to process

Buttcoin buttcoin.org, Butterfly Labs, FTC, pheonix 0 Comment October 4, 2014

ATTN: USERS OF BUTTCOIN 0.7

Alert. Pay-Attention: A laugh was mined that was too big for 0.7 (Buttcoin.org) to process. 0.8 (ButtcoinFoundation.org) could process it and created a fork, causing prologed outages on the 0.7 Buttcoin fork. The game plan is to shut down the 0.7 laugh factory and continue on the 0.8 fork. Do not trust new mined laughs on 0.7.

Additionally, the hard fork created a number of orphaned block-posts so some data may be missing. We expect a roll back to occur in the next few weeks and to back-fill this data as time permits. Please do not bring this to the attention of the devs.

At present, devs are working to establish the precise cause of the bug. We know it’s related to the way 0.7 was purchased by BFL and, specifically, the subsequent seizure of Buttcoin.org by the FTC.

For now, 0.8 is the way to mine laughs, users should not expect 0.7 to come back.I imagine soon enough we will see 0.8.1 and the possibility of a hard fork (0.8 may become incompatible) so keep your eyes open for more news.

(We are

Buttcoin

Bitcoin users in a nutshell

killhamster 0 Comment October 3, 2014

Buttcoin

The FTC Twitter Q & A or “How I got the FTC to say ‘@buttcoin’”

killhamster 0 Comment September 23, 2014

Float like a butterfly, sting like the FTC

Buttcoin/ Captains of Industry/ Crime/ Scams

Float like a butterfly, sting like the FTC

killhamster bitcoin, buttcoin, Butterfly Labs, fraud, mining, scam, stupid 0 Comment September 23, 2014

At FTC’s Request, Court Halts Bogus Bitcoin Mining Operation

1290904111787

At the request of the Federal Trade Commission, a federal court has shut down Butterfly Labs, a Missouri-based company that allegedly deceptively marketed specialized computers designed to produce Bitcoins, a payment system sometimes referred to as “virtual currency.”

The FTC’s complaint against the company and its corporate officers alleges that Butterfly Labs charged consumers thousands of dollars for its Bitcoin computers, but then failed to provide the computers until they were practically useless, or in many cases, did not provide the computers at all.

Satoshi Hacked!

Buttcoin/ Captains of Industry/ Crime

Satoshi Hacked!

killhamster bitcoin, buttcoin, fail, hack 1 Comment September 8, 2014

News from Thermos, king turd of Bitcoin’s various shit mountains:

[email protected] is compromised
Today at 09:06:34 PM

Today I received an email from [email protected] (Satoshi’s old email address), the contents of which make me almost certain that the email account is compromised. The email was not spoofed in any way. It seems very likely that either Satoshi’s email account in particular or gmx.com in general was compromised, and the email account is now under the control of someone else. Perhaps [email protected] expired and then someone else registered it.

Don’t trust any email sent from [email protected] unless it is signed by Satoshi. (Everyone should have done this even without my warning, of course.)

I wonder when the email was compromised, and whether it could have been used to make the post on p2pfoundation.ning.com.

 

The email said:
“Michael, send me some coins before I hitman you.”

Not exactly Satoshi’s normal style. ;)

 

Satoshi Nakamoto replied to Satoshi Nakamoto’s discussion Bitcoin open source implementation of P2P currency

“Dear Satoshi. Your dox, passwords and IP addresses are being sold on the darknet. Apparently you didn’t configure Tor properly and your IP leaked when you used your email account sometime in 2010. You are not safe. You need to get out of where…”

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