Quote from: Freakin on June 20, 2013, 11:44:45 PM

Quote from: k9quaint on June 20, 2013, 11:34:01 PM

Quote from: Freakin on June 20, 2013, 11:19:43 PM

Quote from: k9quaint on June 20, 2013, 11:01:21 PM

Quote from: Freakin on June 20, 2013, 10:47:13 PM

BFL did not receive bitcoins for preorders. BFL received USD and allowed customers to exchange BTC for USD using BitPay for their own convenience.

Customers paid in BTC. Bitpay acted on behalf of BFL (like a bank or credit card company would) to receive that BTC. What BFL instructed Bitpay to do with that BTC after receiving it is BFL's business. If BFL received USD from Bitpay, then it was only because BFL instructed Bitpay to convert the BTC into USD.

Quote from: Freakin on June 20, 2013, 10:47:13 PM

When a customer placed an order they immediately exchanged their BTC for USD and used that USD to pay for the order. This is exactly the same as if you sold bitcoins for cash, deposited cash into your bank account, then used your debit card to pay for the preorder, except that it is much much easier and quicker. BFL did not gamble on any currency, they did exactly the opposite.

You clearly did not read the bitpay faq here: https://bitpay.com/faq
Bitpay does what the merchant instructs with the funds. If BFL wanted the BTC so they could escrow it and refund it like they claimed to, then Bitpay would have sent them BTC. If BFL wanted to instead spend that BTC on operations and development, then Bitpay would have converted it to USD for them.

My mistake, you are correct. Didn't realize there were multiple options for what happened with your funds.
Can someone point me to the post where BFL says they kept the funds in bitcoins?

BFL says they kept the funds in escrow so that if customers wanted a refund they could depend on their funds being there. The only reason BFL would convert them to USD would be to spend them on something which they promised they would not do until the orders were shipped.

Or because they didn't want to base the entire future of their electronics manufacturing business on a highly volatile currency. The USD is probably not going to crash in price overnight, but bitcoin could and has. You're telling me you'd trust a company *more* if they kept their holding entirely in BTC?

Remember, originally BFL was only going to hold the BTC for 4 months while they designed and manufactured their ASICs (June 2012 to Oct 2012).
BFL offered full refunds, and said they held the funds they received from pre-orders in escrow. How they manage their currency risk due to that escrow is their business.
I am not saying they should hold all their funds in BTC. I am saying they should have held the BTC they received from customers in escrow until they shipped the product. If they want to bet on another currency while holding their customers funds, that is their business. If BFL bet on USD over BTC, they lost and should not pass that loss onto their customers.
If BFL wanted to spend the BTC on operations and parts, they could have said that is what they were doing with it. Avalon does that. Avalon offers no refunds because they are spending the order money on operations and parts. BFL chose to offer full refunds to all customers, so they couldn't very well spend all the money they got.

Quote from: Freakin on June 20, 2013, 11:44:45 PM

So the prices were all posted in USD? And customers who want to purchase the devices saw a price in USD that they agreed to?

If they chose pay in BTC, they were shown how many BTC they needed to pay. This wouldn't be an issue if BFL did not claim to have all customer pre-order funds in escrow and offer full refunds to any who wish it. If they spent the money on operations and parts, I would be fine with it if they would just come out and admit it.