It's All About the Bitcoins

Class Action Suit Filed Against BitInstant for Allegedly Misrepresenting the Speed of Its Services

Plaintiffs argue that no, you can't make transfers within 2 hours.
Mr. Shrem

Mr. Shrem

BitInstant, the New York-based Bitcoin startup that promises to make it easier and faster to transfer Bitcoin funds, has been hit with a class action suit, according to CoinDesk.

In the suit, three BitInstant customers allege that the startup makes false claims about its services, including advertisements that say customers can obtain coins “within an hour or two,” and that they will be refunded if their transfers experience “undue delays.” The customers call these representations “disingenuous,” and are suing the company for relief for the company’s false representations of the speed of its service.

According to the lawsuit, published by CoinDesk:

Plaintiffs bring this action to enjoin BitInstant from continuing its deceptive and unlawful practices, to require BitInstant to refund fees paid by consumers for expedited services those consumers never received, for disgorgement of all profits attributable to BitInstant’s unlawful practices, and for such other relief as requested below.

The plaintiffs are bringing the lawsuit on behalf of U.S. residents who made dollars-to-bitcoins transfer requests to Bitcoin that did not happen within two hours.

“We have not had a chance to review the complaint with our lawyers, so we can’t comment on its details,” BitInstant CEO Charlie Shrem told Betabeat. “As everyone in the Bitcoin community knows, though, we’re dedicated to doing right by all of our customers and are surprised to learn that any have unresolved support issues. We are committed to demonstrating that to the Bitcoin community everyday.”

BitInstant is helmed by Mr. Shrem, the Bitcoin boy wonder, and operates out of a small office in Flatiron. The team is largely comprised of engineers, Bitcoin enthusiasts and financial services experts, but is small considering the volume of customer demand.

BitInstant was already in the news earlier this week when the New York Department of Financial Services issued a subpoena to New York-based Bitcoin businesses in an attempt to gather more information about the cryptocurrency.

The full lawsuit is embedded below.

BitInstant Class Action Lawsuit

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