We rely on available evidence and testimony from the buyer and seller to come up with an equitable resolution. With purchases involving physical goods this process is particularly straight forward. We check shipping information, shipping weight, photographs, documents and how this conforms to the invoice. In most cases where there is a dispute the item is damaged or defective. If the item received is the wrong size, color, or different model number than what is specified on the invoice we will request that the buyer return the items to the seller before funds are returned.
If the sale involves non-tangible goods (such as a domain name or corporation) or a service (such as consulting or repairs) the process is much more nuanced and requires a more extensive review. In some cases a perfect decision cannot be reached but we nevertheless try to find the most fair and reasonable approach based on available evidence. In some way, this is process is not that different from a customer disputes a charge with their credit card company.
We use state of the art security, using the blockchain itself to store Bitcoin that has been used to fund transactions. To date, it is impossible to hack the Bitcoin blockchain and it is theorized that one would have to spend over $30 billion USD to create one fake Bitcoin, if it is possible at all. Furthermore, each receiving Bitcoin address is set up in such a way that the address is capable of only two transactions - either sending funds to the originating address (back to buyer) or destination address (release to seller). Bitfi does not hold the private keys for any of the holding addresses and therefore no employee (including founders) at Bitfi can access these funds. This offers fortress like security eliminating any possibility of loss either from external or internal threats. Therefore it is entirely safe to make transactions at any price, even in the millions. Whether you are buying a bottle of wine or a 200ft luxury yacht, Bitfi is the most secure transaction platform available.
The only personal information that we collect from you is information that is necessary to complete a purchase. This includes your name, email, and shipping address. Typically no other information is needed for most transactions. This information is stored on a highly secure and dedicated Microsoft Azure server that is certified and regularly audited for weaknesses.
Our systems are designed to handle 100% secure transactions of any size from $20 to $200,000,000 or more. Whether you need to buy some gadget or an island Bitfi is the safest platform to buy anything with Bitcoin.
At this time we charge sellers 0.25% per transaction on physical goods and 0.5% per transaction for services (since in the event of dispute, services and non-tangible goods require significantly more research). Buyers have no fee to use the system. This is significantly cheaper than merchant account fees with credit cards and Bitfi offers much greater protection and privacy than a credit card.
Our goal is to insure smooth transaction flow and to get funds in the hands of the seller as quickly as possible once the buyer has received the goods or services they have paid for. In order to eliminate delays our system requires that buyers provide feedback regarding their transaction within 36 hours of receiving goods and 48 hours after receiving services. If the buyer does not do so within this time period, the funds will be automatically released to seller by our system.
Example 1: Sally wants to purchase a computer from John for $2,500. John sends Sally an invoice through Bitfi providing a complete description of the computer, the shipping costs, and the lead time (how long it will take to ship after Sally makes payment; in this case John specified 3 days). Sally pays the total of $2550 (including shipping charges) to the seller’s Bitfi Bitcoin address (as specified in invoice). There are now only 5 possible outcomes possible outcomes:
A - John ships the computer and enters the tracking number into our system. Our system will then automatically track the shipment and sends an email and text message to Sally the moment the package arrives on her doorstep at 9:12am, January 1st. Sally is asked to provide feedback on the transaction specifying 1 - 5 (breaks down as follows…). Sally marks 1 because she is highly satisfied with the transaction and the funds are instantly released to John (he is also notified by email and text when this happens).
B - Sally is notified by our system that the package has been delivered and asks her to rate the transaction. However, Sally does not rate the transaction at all. The Bitfi system sends her several notices by email and text to remind Sally that time is running out and how much time still remains from the original 36 hours to rate the transaction. As soon as 36 hours has passed and we still haven’t gotten any feedback from Sally, our system assumes that there are no problems with the delivery and funds are instantly released to seller the moment the clock strikes 9:12pm on January 2nd.
C - Sally is notified by our system that the package has been delivered and when she opens the package she notices that computer she purchased does not meet the description on the invoice. Sally paid an invoice describing a 15-inch MacBook Pro but instead received a Dell laptop. Sally then rates the transaction a 3 (enter description) and this automatically opens up a dispute. The money does not get released to seller and the transaction is forwarded to Bitfi staff for review and we then contact the seller to find a resolution.
D - After Sally pays the invoice, John does not ship the computer within 3 days. Since our terms of service provide a 1 day grace period, our system will notify John that he must make the shipment and provide a tracking number (via email and text). If our system still does not have confirmation that the item has been shipped after 3 days + 24 hours then the transaction gets cancelled and funds are automatically returned to the buyer.
E - John ships the computer but the package is lost by the shipping company. In this case, either Sally or John should open a claim by notifying our dispute resolutions department. Once we confirm that the package has been lost, the funds will be returned to Sally.
Example 2: ABC Corp. wants Eric to design a new e-commerce website. Eric then sends an invoice through Bitfi and attaches a proposal along with any other relevant documents on the project. Eric puts together a very detailed invoice and proposal so that ABC Corp. knows exactly what to expect and a lead time of 3 months. The total cost of the project is $150,000. ABC Corp. sends payment to Eric’s Bitfi Bitcoin address. There are now only 5 possible outcomes:
A - After Eric receives confirmation that ABC Corp. has made payment he starts working on the project. The project is complete in 7 weeks and he then logs into his Bitfi account and February 9th at 7:22pm marks the service as complete. ABC Corp. then receives an email and text message notifying them that they have 48 hours to rate the transaction from 1 - 5 (specify). ABC Corp. is absolutely delighted with the project and specifies a rating of 1. The funds are then immediately released to Eric.
B - After Eric marks the project as complete and ABC Corp. receives multiple notifications that the project is complete, ABC Corp. does not rate the transaction. Each notification specifies how much of the 48 hours remains to rate this transaction. Since ABC Corp. never rated the transaction, our system assumes that Eric has performed all of his obligations as specified in the original invoice and instantly releases the funds to Eric the moment the clock strikes 7:22pm on February 11th.
C - After Eric marks the project as complete, ABC Corp. reviews the submission from Eric and realizes that it is materially different from what was described in the original invoice and project proposal. The e-commerce features in the described in the proposal are missing and some do not work properly. In this case ABC Corp. marks that transaction a 4 (specifiy) and this automatically starts a dispute. Our team will then reach out to both the seller and buyer to collect documents as well as other details and make a speedy resolution.
D - Eric gets distracted with other work and never starts the project for ABC Corp. After a few days of receiving payments he realizes that he is spread too thin and does not have the resources to properly deliver the project to impress his client. He then logs into his Bitfi account and cancels the transaction which instantly returns the funds to ABC Corp. (Alternatively, if Eric had not cancelled the transaction, after 3 months + 1 week grace period, the funds would have automatically been returned by our system to ABC Corp. But since Eric wants to maintain a good reputation with his clients, he does not delay the return of funds to ABC Corp).
In each case, once payment is made by the buyer our system will insure that goods or services are delivered exactly as described in the original invoice.
For transactions under $50,000: Once a transaction has been initiated, our system will enforce all of the conditions stipulated on the original invoice, which includes the item or service description and lead time. If you originally specified that it will take 7 days to ship an item or 7 days to complete a service and it ends up taking longer, there is no way to modify the transaction. If the buyer agrees to modify the terms of the transaction, you should then simply cancel the original transaction (which will automatically return funds to buyer) and start a new transaction by sending a new invoice to buyer (there will be no fee charged for using our service if the transaction is cancelled, except a small miner fee charged by the Bitcoin network which we have no control over).
For transactions over $50,000: If you are a seller and there is a legitimate reason why either the item or service will take longer to deliver than originally specified we can review the details and extend the lead time. However, in most instances this cannot be done without written authorization from the buyer. We recognize that some transactions can be remarkably complex and will review large transaction on a case by case basis.
We will be adding an option in the future that allows sellers to convert the Bitcoin paid by buyer into USD and have funds deposited into your bank account. However, you may find that it is advantageous to receive payment in Bitcoin(BTC) instead of USD. There are several reasons for this, but probably the main reason is that BTC has been continuously rising in value since its creation while USD is dropping in value over time (in the last 100 years the purchasing power of $1 had declined by 97%). If you can withstand the short term volatility of BTC, you may find that your earnings are further enahnced with appreciation of BTC that you collect for goods and services over time.
Bitcoin and the underlying blockchain technology is an emerging new tech in eary stages that is experiencing rapid growth and adoption. It is therefore expected that there would be sugnificantly more volatility than other currencies.
While there are people who promote this story, this is never going to happen. In fact, Bitcoin cannot exist without currencies like USD because its value is expressed in those currencies to begin with. Saying that the value of Bitcoin has increased is the same as saying that now it costs more USD to purchase a Bitcoin. Bitcoin is simply a digital asset that is extraordinarily rare, difficult to create, and has a finite supply which makes it a store of value like gold but it also behaves like a currency because it is very easy and convenient to transmit Bitcoin from one party to another.
Bitcoin functions in a very similar way. Gold and silver have been a store of value for thousands of years for two main reasons: their scarcity and their network effect. But these precious metals have many limitations, are difficult to store, and difficult to transfer from one party to another. Bitcoin is superior to precious metals because the amount of Bitcoin in circulation is precisely known (while someone can discover a large gold mine on the bottom of the ocean or perhaps on an asteroid which would increase the supply by unknown amounts) and one can very securely store unlimited amounts of Bitcoin without physical security concerns.
As described above, without a network effect nothing could function as a store of value or a store of wealth. For this to happen, large numbers of people need to agree that something will perform this function (as they do for gold). Therefore if someone would create a replica of Bitcoin it would not have any value simply because it would not be Bitcoin. Other digital currencies and assets have gained value because they offer certain features that are not served by Bitcoin so they have their own place in the financial ecosystem. So no matter how many more digital currencies are created, there will always be one Bitcoin (just as there are many other scare objects besides gold that have no value or liquidity at all).
Anything that has a dominant presence within any market segment id considered to have a network effect. For example, thousands of companies can create an identical search engine as Google and a social network like Facebook with identical features but they will simply not have the value of either Google or Facebook. So if an identical currency as Bitcoin was created, it would also not have any value very simply because Bitcoin has a strong network effect and the copy of it does not. There are also very rare paintings that are equally as rare as Picasso or Pollock but because they have no network effect they may have no value at all while the latter are selling for tens of millions of dollars.
Bitcoin is a digital asset that acts as a store of wealth and a transactional currency. It is no more illegal than baseball cards that can be used for the exact same purpose. You can store all of your wealth in a collection of baseball cards and then use it to purchase goods and services (although it would be a lot less convenient than with Bitcoin).
There are several options for storing Bitcoin. You can store BTC in a phone wallet like Jaxx or Coinomi or a desktop wallet like Exodus, they are extremely easy to use but offer only medium security. It is not recommended for storing large sums of Bitcoin long term on these kinds of wallets, think of them like a wallet that you have in your pocket. For improved security and long term storage you can use a hardware wallet like Trezor or Ledger Nano S. For the absolutely highest security and long term storage of unlimited amounts of Bitcoin we recommend storing Bitcoin on a paper wallet. You simply print a paper wallet using a paper wallet generator and then send Bitcoin to the address that is printed on the paper wallet. A paper wallet can be encrypted or not. If you choose not to encrypt your paper wallet, then anyone who has the private key (the sequence of letters and numbers also printed on the paper wallet) can access the funds so its important to store your paper wallet in a safe place. Alternatively, you can also encrypt the private key on the paper wallet (if you do this, anytime a private key is entered in order to access the funds, the user will also be prompted for a password) which offers impenetrable security (in this case, even if you paper wallet is stolen, who ever steals the paper wallet still cannot access funds without this password). You can make multiple copies of an encrypted paper wallet and store them in multiple locations. It is extremely easy to create a paper wallet for your Bitcoin. You can find simple instructions here. However, while an encrypted paper wallet offers impenetrable security you must be very careful to insure that the password you use is not forgotten because you yourself will not be able to access the funds without this password. With Bitcoin, you are completely responsible for your own money and there are no third parties you can contact if you forget the password. With enhanced privacy there comes increased responsibility.
Bitcoin is stored in a decentralized blockchain using advanced cryptography where your funds are kept at a public address (think of it like an email address) that is only accessible with a private key that consists of 58 randomly generated letters and numbers and the private key itself can be encrypted with a password. To date, not a single Bitcoin public address has been hacked and if you store your Bitcoin on an encrypted paper wallet this offers better security than any bank vault. There are several Bitcoin addresses that store in excess of $250m that have been stored for several years. To date, there is no better option to store your wealth than the Bitcoin blockchain. You have a better chance of winning the lottery 100 times in a row than hacking into a Bitcoin address where your funds are stored.