Quote from: Luckybit on April 02, 2013, 07:06:32 AM

Quote from: deepceleron on April 01, 2013, 08:16:57 PM

There have been an increasing number of posts from recently registered users requesting purchases of bitcoins with PayPal. While new users may indeed be enthusiastic about Bitcoin and be accustomed to using PayPal for prior purchases, this type of request is also exactly what scammers do to steal bitcoins.

Traditional payment networks (including PayPal) suffer inherent weaknesses:

Some payment fraud is unavoidable,
Completely non-reversible transactions are not possible; payment processors are involved in disputes,
Identity fraud and remote account takeover using stolen credentials are possible,
Payment processors can block funds and freeze accounts,
You must provide your credit card or account number to sites, which can be stolen by hackers to spend your money.

Bitcoin has none of these problems:

Confirmed Bitcoin payments are absolutely trustable,
Payments are non-reversible; money cannot be recalled by the sender,
Identity theft is a non-issue - payment recipients don't need validate the identity of buyers to trust their payment,
Nobody else can interfere with your Bitcoin balance or your ability to send or receive money,
You are in control of your money - when you send a payment, the recipient or hackers cannot make fraudulent withdraws from your wallet.

Why is it difficult to purchase Bitcoins with your old-fashioned money?

If this is the fault of Bitcoin, it is because Bitcoin is too good. If you receive a payment with Bitcoin, you can be 100% sure that the money is yours and it can't be disputed or taken back out of your wallet. Credit cards, ACH checking transfer and money wires, Chase Quickpay, PayPal, Dwolla, and most any other banking payments, however, can be reversed - they are less trustworthy than the Bitcoins you are trying to buy. The person offering to buy Bitcoins with PayPal may either dispute the payment with PayPal, reverse the payment through their credit card processor, or even may be using a hacked or stolen PayPal account.

This is why even Bitcoin exchanges have rigorous verification procedures - they need to verify your identity thoroughly, not because of Bitcoin, but because they are taking your government currency, transferred through banks and payment processors, which is fundamentally problematic. Exchanges that only deal with Bitcoin-based virtual currencies (such as Bitcoin to Namecoin) have no such identity requirements.

In addition, PayPal specifically disallows currency exchanges, and are Bitcoin-hostile. When you complain that you were ripped off, it's just as likely your account will be frozen.

Quote from: Paypal acceptable use agreement

Prohibited Activities

You may not use the PayPal service for activities that:

...

relate to transactions that (a) show the personal information of third parties in violation of applicable law, (b) support pyramid or ponzi schemes, matrix programs, other "get rich quick" schemes or certain multi-level marketing programs, (c) are associated with purchases of annuities or lottery contracts, lay-away systems, off-shore banking or transactions to finance or refinance debts funded by a credit card, (d) are for the sale of certain items before the seller has control or possession of the item, (e) are by payment processors to collect payments on behalf of merchants, (f), are associated with the sale of traveler's checks or money orders, (h) involve currency exchanges or check cashing businesses, or (i) involve certain credit repair, debt settlement services, credit transactions or insurance activities.

So how can you obtain bitcoins, if nobody on the Internet can tell the difference between you and a foreign crime syndicate? If you don't wish to go through the lengthy verification procedures on exchanges, I recommend you first investigate local traders who are willing to exchange bitcoins in person. Sites such as https://localbitcoins.com/ or http://www.tradebitcoin.com/ may help you find local Bitcoin users. Also, Bitcoin is for commerce - sell something and accept Bitcoin!

So what is the best and safest way to purchase 20-30 Bitcoins? Tell me so I can go buy some. The way it is now it's like looking for Bitcoins in the black market because all the banks seem to have a conspiracy not to work with you.

If you want to be really safe, go where most the bitcoins trade are: mtgox
or try localbitcoins and see if you have any seller around you. Good luck.

wonderbash

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