Coin base is a complete fraud
Well, it's not too hard to see how it works. I validate my bank account. I initiate transaction on my end, they buy bitcoins on their end and wait few days for my money to reach them. They tell you it has to take a week or longer and gives u specific date. Since bitcoin is so volatile, big changes can happen in a week.
IF bitcoin goes up, they cancel my transaction and say it is "high risk" and initiate a return of my money. IF bitcoin goes down they allow transaction to stay and they keep my money and give me the bitcoins.
It is common sense. Obviously they're not going to steal from every transaction, and they can pick and choose how much they make.
http://blog.coinbase.com/post/*******068/high-risk-transactions
This blog post here is vague and a lie. He cites that it is because ppl try to scam them with fake bank account #s and such. That is such a lie, because you can never scam someone with fake bank account # if the purchase isn't instant. because transaction won't go thru, DUH. Same with fake credit card #s, it WONT GO THRU.
With the whole high risk transaction mechanism, coinbase can literally control exactly how much they can make off of the volatile market. I was one of the people that got hurt REALLY bad. some people might even benefit from a canceled order. but the point is, coinbase CONTROLS everything.
I want coinbase to SHOW PROOF that they have been ripped off because people used fake bank account #s. THEY CAN'T. Because you can't get ripped off from a fake account #. You cannot get ripped off if the purchase is not instant.
With the high risk transaction mechanism, Coinbase is GUARANTEED to make money. In a market that is growing, all they have to do is have the system set to flag xx% of transactions, and they are GUARANTEED to make money off this. A LOT of money based on how many transactions they process.
COINBASE, if you are reading this. Please respond and defend your case (i know, your answer would probably be "we can't disclose, blah blah blah.)
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