They're just both services that are run by folks who weren't expecting to hit the scale they are now, have no experience building financial systems, and are waaaay in over their heads.
Bitinstant recently laid off all of their support staff and has gone quiet for nearly two weeks on support related matters. Their CEO, Charlie Shrem, used to constantly tweet several times per day. He hasn't tweeted in 9 days now and seems to have vanished (https://twitter.com/charlieshrem). Over the holiday weekend, their $8/mo SquareSpace account used for hosting their blog was suspended for billing issues (though they have since scraped up the $8).
Bitinstant is taking money from new orders and allocating it to old orders (aka Ponzi Scheme). I suppose that means that as long as new orders continue to arrive, customers will be made whole and eventually they could earn enough in fees to cover up whatever they did that caused the mess they are in. That's if someone doesn't complain to the FBI first and get them shut down.
Their bitcoin service to top up phones disappeared pretty quickly too and never came back, also their debit card service never happened. They used 'VouchX' which was run by a shady guy who disappeared after LR went pop so maybe that's why they can't afford staff.
Bitinstant regularly provides a worse price to customers than they could possibly have obtained on any public exchange at any time between receiving payment and sending the coins. Users can apparently recover funds stolen by BitInstant by making noise in public places.
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Bitinstant isn't any more a scam than Mt. Gox is.
They're just both services that are run by folks who weren't expecting to hit the scale they are now, have no experience building financial systems, and are waaaay in over their heads.
Bitinstant recently laid off all of their support staff and has gone quiet for nearly two weeks on support related matters. Their CEO, Charlie Shrem, used to constantly tweet several times per day. He hasn't tweeted in 9 days now and seems to have vanished (https://twitter.com/charlieshrem). Over the holiday weekend, their $8/mo SquareSpace account used for hosting their blog was suspended for billing issues (though they have since scraped up the $8).
Bitinstant is taking money from new orders and allocating it to old orders (aka Ponzi Scheme). I suppose that means that as long as new orders continue to arrive, customers will be made whole and eventually they could earn enough in fees to cover up whatever they did that caused the mess they are in. That's if someone doesn't complain to the FBI first and get them shut down.
https://bitcointalk.org/index.php?topic=128314.8180 (that is one of the most recent pages of a thread containing ~411 pages of complaints). The last few pages are especially disturbing.
Their bitcoin service to top up phones disappeared pretty quickly too and never came back, also their debit card service never happened. They used 'VouchX' which was run by a shady guy who disappeared after LR went pop so maybe that's why they can't afford staff.
Bitinstant regularly provides a worse price to customers than they could possibly have obtained on any public exchange at any time between receiving payment and sending the coins. Users can apparently recover funds stolen by BitInstant by making noise in public places.
http://www.reddit.com/r/Bitcoin/comments/1ccjgh/psa_bitinsta...