Wednesday, 12 June 2013

Butterfly Labs Mining equipment - is it a ponzi scheme?

For those of you who are interested in taking Bitcoin mining to the next level, or are considering investing in the sport, can get themselves to the bitcoin mining equipment from Butterfly Labs.

The Butterfly Labs ASIC are basically small crypto calculators that specialize at only one thing - that's crunching numbers.

Is Butterfly Labs a ponzi scheme? isn't. They are a company based in Leakwood, Kansas. The whole process isn't well established though. The main reason for this is a small company size, which increases the profit margin for them. The very fact that the payment method is by-wire, justifies this.

Many theories have been put forward by various conspiracy theorists on the internet regarding the credibility of Butterfly Labs, claiming that your money is being used to create miner machines that BFLabs uses itself to mine coins before shipping out the product to the consumer. (Note, that there is an infinite waiting time for each mining equipment, as stated on the company website.) The company website clearly states a waiting time of 2 months or more.

Trustworthy reviews

All of this is a bit risky, for people who want a guarantee for everything. Butterfly labs looks a bit shady, but they do keep their word, as people have been getting their bitcoin mining software (a bit late though) eventually!

The last review is probably the most trustworthy. Wired online magazine is one of the most trustworthy online magazines. But then at the end of the day scams do happen. In this case the probability looks high, since the company Butterfly Labs do have an upper hand in the situation with all your money. But the reviews and testimonials by individuals online, don't say so. I have made an order for a 25 GH/s machine and my orders are all reflecting correctly. It is a waiting game from here on. I'll keep all the readers here at Bitminers Guide posted about how that goes.

My shopping experience at Butterfly Labs Inc.

Like I said before the whole thing looks quite shady, but I have invested in a few other ASIC equipment before and that's how these people usually work. The main reason is a low workforce, and low resources. This company apparently uses your money in real-time to create your ASIC mining equipment. That is to say, your order is made only once you've made the payment.

You register with them online, and have 3 payment options. Bitcoins, Paypal, and wire-transfer.

I used the wire-transfer option, since I don't have a paypal account that I use regularly. You have to visit your bank branch for this option. Since the money is being transferred manually. You may have to specify the reason for the bank transfer, and you can call it - "Purchase of computer peripheral" or "electronic device."

The payment took about 48 hours to show up in their system. I did send the butterfly labs message a team, to which I didn't get any response, but on the other hand my status was updated from "Pending" to "Processing," which means that my money has been received.

Other than that, I fully support the Bitcoin Project. There are some doubts we all have regarding this opensource project, but considering the idea, all open source project's are aimed towards the betterment of the human society. If you are smart enough, you can use Bitcoins to your benefit. Securing your bitcoins is essential and that's your responsibility.

Human beings are surely entering a new era, of financial transactions. The last time we saw something like this was when currency itself was invented. Many people, I am sure, must have had their doubts about the currency, and the banking system, but it managed to survive and even exists today. People who control our lives, are essentially the people, who are in the banking sector. They can very easily commit frauds, and get away with all your funds, and you can do nothing about it. That's what happened in the United States of America, in the financial bubble burst of 2009. Bit coin, gives the power to grow, to each and every individual equally. Well, at least if you are an early bird!

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