Recently Blockchain.info listed HashPrime.com as a partner on the Blockchain.info website.
HashPrime.com claimed to be a site where members could invest BTC in to an operation where the managers would invest the funds received in to a mining operation and then pay dividends on the profits they were making.
Many were extremely skeptical of the Hash Prime claim to generate a guaranteed return and suspected a Ponzi scam was behind everything and were extremely hesitant as the site hadn’t been around for a long period.
The site made the claims that they could bring in 1.5% daily returns for investors and required a $25USD minimum investment.
Blockchain.info then added HashPrime to the Blockchain.info wallet as a “partner” and this instantly added a large level of credibility to the company and the site.
Those using Blockchain.info as a wallet saw HashPrime listed under the partner section upon logging in as seen below:
This would later be removed after HashPrime.com vanished from the Internet as seen today on the Blockchain.info site upon logging in to a web wallet:
A large number of users ended up placing large sums of BTC with HashPrime after seeing what many felt was an endorsement and not simply an advertisement. The partners for US users had contained a simple link for gyft a company that many had seen reputable and thus having the HashPrime button next to it lead many users to feel that Blockchain had appropriately vetted the company.
Many were still skeptical however with discussion on Bitcoin Talk discussing the possibility that HashPrime was not only a Ponzi but that the partner links were merely advertisements. One reddit user even reached out to the company sending an email letting Blockchain.info know that it was a scam and received the following response:
Hey there. They currently do sponsor an ad within our wallet, which is what you’re seeing there. We don’t offer any guarantees or support with their service, but we also make sure we properly vet each of our sponsors before starting any type of campaign with them. I’d contact Hashprime directly with any questions or concerns you may have, as they can assist you with this. I’d also advise users to check with the community for positive experiences others have had.
The response from Blockchain had claimed they had done some vetting of the company before allowing them to be a “sponsor / partner” but has led many in the community to question what sort of vetting is taking place.
A few days after the button appeared on the Blockchain.info website the HashPrime website posted a blog claiming due to the recent drop in bitcoin price they would no longer be allowing for withdraws after ten days but instead would now be allowing withdraws after fifteen days. Coin Fire had been monitoring the situation on Bitcoin Talk and noticed the sudden discrepancy when we began asking the community via reddit and other sites to begin emailing us thoughts about the entire situation.
The button remained on Blockchain even after the change to the withdraw period that had upset many users and Blockchain announced a $30 million dollar round of funding which lead to even more rampant speculation in the community why the site would promote something that was increasingly looking like a Ponzi scam.
On October 9th the website HashPrime finally went offline and now appears in this form at the time of this writing:
The site now appears offline with an SSL error and appears to have vanished after building up a substantial BTC balance from users who made “investments”.
Coin Fire has spoken with several people who were duped by this investment. We also reached out to Blockchain who at the time of press has failed to respond to our emails inquiring about the matter. Blockchain did make a donation of some of the funds they received from HashPrime to Sean’s Outpost but many are still left with a sour taste and are left wondering what sort of diligence the company performed before taking the money and listing the company as a “partner”.
Below is just a small sample of some of the emails that Coin Fire has received about this matter from several end-users angry about the entire situation.
HashPrime scammed me for $780.76.
BlockChain.info promoted them as partners right on my wallet’s start page next to the Gyft Shop button, and the IOS Mobile App button, I trusted them because I thought BlockChain was safe.
Let people know that BlockChain promotes scammers or they are scammers as well, who knows maybe someone there took advantage of their reach to us as users, and saw this as an opportunity for some fast money.
Who can trust their (scammer) partners now?
Not me even if they have a button that says MICROSOFT or VIRGIN mobile… they might send me to a phishing site or something.
I’m done with BlockChain…
arroyoc3 wasn’t the only one who reached out to Coin Fire though about the situation. We spoke with many who had reports of being ripped off and felt Blockchain’s handling of the situation was poor.
Henry shared the following with us via an email:
I have drawn one main conclusion from this experience: there is no way that hashprime could have ever pulled off their scam on such a massive scale without the negligence and complicity of Blockchain.info.
This was not just an ad. Blockchain listed hashprime as one of their “partners.” That term alone made a huge difference in the level of trust that hashprime received from it’s victims.
In my opinion, I don’t expect Blockchain to take any financial responsibility and offer restitution, but they certainly deserve to lose a good chunck of their reputation, especially with the growing number of competing btc wallets out there.
If such a blatant robbery isn’t brought to the attention of the ever-expanding bitcoin community, it’ll only be a matter of time until blockchain’s next “partner” runs off with double the amount of bitcoins stolen by hashprime.
Here’s how it happened:
On October 3, 2014, I invested $55.23 worth of BTC into hashprime, which I was told in an email from their admin as well as their site, would be available for withdrawal in 10 days. 24 hours after my deposit, I was able to request and withdraw my first day’s 1.75% profit of 83 cents back into my Blockchain wallet. The day after that, I was able to do the same, receiving a total interest of $1.66 in BTC.
By day 3, on October 6th, my 3rd request for withdrawal was never processed, and remained “pending” on my account page. On day 4, I made another unanswered request. So today, on day 5, I decided to contact hashprime’s admins and wrote them the following message:
I have an email from you that states my deposit would be available for withdrawal after 10 days. Then, all of the sudden and without even notifying me, you changed it to 15 days.
Also, I have a withdrawal request that is more than 24 hours old and still has not been processed. I have been using your service for 3 days and I am already experiencing multiple problems.
You even have a red “Live Support” button that doesn’t work at the top of your page. These kinds of issues make it very probable that this entire site is a scam. The only reason I trusted your service is because blockchain was willing to advertise you on their page.
Henry also provided us TX logs and screenshots of his HashPrime account that verify his account of how things went down.
We spoke with many others who were appalled and many whom felt Blockchain.info should take some responsibility about the entire situation.
How do you feel about the situation? Do you blame the people who invested and thought the partners section was some sort of endorsement versus a normal advertisement? Do you feel Blockchain has appropriately addressed the situation?