US COURT SHUTS DOWN FAKE BITCOIN-MINING OPERATION (STA BREAKING NEWS and ARCHIVES)

by STANews , Tuesday, September 23, 2014, 14:17

A US court has shut down Butterfly Labs, a Missouri company the Federal Trade Commission alleges deceptively marketed computers designed to produce bitcoins, the “virtual currency” payment system.

The FTC’s complaint against Butterfly and its corporate officers alleges that the company charged consumers thousands of dollars for its bitcoin computers, called BitForce, but then failed to provide the computers until they were almost obsolete, or in many cases did not provide the computers at all.

Unlike traditional currency, bitcoins are not distributed by a central bank or backed by physical assets like gold, but instead are “mined” by users who use computers to calculate increasingly complex algorithmic formulas.

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http://www.theguardian.com/technology/2014/sep/23/ftc-complaint-closure-bitcoin-mining-butterfly-labs