6 ms·

Show HN: Buttercoin (YC S13) US Bitcoin Marketplace – Free Trading Through Dec

69 points by revcbh 12y ago

revcbh 12y ago
We're finally open for anyone to signup, so we're celebrating with free trading. Please write bots, we've got a pretty good API. The open source re-release of the engine is also back up for anyone that wants to play with it: https://github.com/buttercoin/engine https://github.com/buttercoin/engine
theavatare 12y ago
Congrats! Looking snazzy.
kyu 12y ago
Congrats on the launch!
modeless 12y ago
It's a bit strange that Alexis Ohanian is listed as an "investor" in the page and also as a "founder" in the footer. I guess the footer isn't intended to mean that he's a founder of Buttercoin, but it sure is easy to misread it that way.
- revcbh 12y ago
  Thanks for pointing that out. I'll try to make it more clear.
  - modeless 12y ago
    Thanks for making Buttercoin! It looks great and I'll certainly be using it the next time I exchange bitcoins.
- shakethemonkey 12y ago
  Also I am not sure how this[1] fits in. I remember Paul Bohm being the founder or co-founder of Buttercoin, but his name is absent. [1] https://www.youtube.com/watch?v=YLoVikMXBeA https://www.youtube.com/watch?v=YLoVikMXBeA
  - lowglow 12y ago
    At one point he was a co-founder. He has since left.
    - shakethemonkey 12y ago
      History was rewritten, then? You can't just un-co-founder someone. In unrelated news, we have always been at war with Eastasia.
      - revcbh 12y ago
        Paul left after a couple of months and hasn't been involved with the project for about a year and a half. None of the design or code is based on the original open source effort which he started. We're not trying to hide history, he just doesn't want people thinking he's associated with it anymore.
  - revcbh 12y ago
    Paul started the effort to build an open source trade engine and had buttercoin.com lying around. We joined up with him a couple of days after he announced the idea and started working on it. Cedric and I already had an interview lined up for YC, but we all thought it was a good enough idea to add Paul and change the idea we were applying with. Unfortunately things didn't work out and the original open source effort died off when we decided to start with a fresh implementation. We just recently release the engine we're using (with some minor tweaks) under an MIT license here: https://github.com/buttercoin/engine https://github.com/buttercoin/engine. We'll be backporting a bit more functionality until we can actually run it in production.
elyrly 12y ago
Thanks for the talk (Bennett Hoffman) yesterday @ Bitcoin meetup yesterday. Looking forward to the additional features to be rolled out.
joeyspn 12y ago
"Unfortunately Buttercoin is not accessible from your location" [0] Europe/Spain [0] https://s3.amazonaws.com/static.buttercoin.com/location-not-supported.html#/setup?r=D6YDrSLZ6GX https://s3.amazonaws.com/static.buttercoin.com/location-not-...
- LukeFitzpatrick 12y ago
  Same here, assume on the U.S.
- eof 12y ago
  AML, presumably?
  - revcbh 12y ago
    It has to do with banking and regulation. Adding new regions takes a lot of time and effort to get right, but we're working on it.
- revcbh 12y ago
  Yeah, we're working to expand coverage and bank relationships outside of the US. I can't give any specific timeline, but it's one of our highest priorities.
Alupis 12y ago
Very annoying that they break the browser back button... (it just reloads the page)
- 0x0 12y ago
  Not only that but the back button shenanigans seems to actually have caused the HN favicon in MobileSafari new tab screen to be replaced with their bitcoin logo!
  - revcbh 12y ago
    Ha, I'll have to try that. Does it use our icon even if you just navigate to HN directly?
    - Alupis 12y ago
      Could call that a feature ;P
- kenrikm 12y ago
  Usually I associate sites that break the back button as untrustworthy (Spam, Porn, Porn Spam, Malware). Not a great first impression considering, you know bitcoin, money and all of the fraud that has been associated with it to this point.
- revcbh 12y ago
  Oops, that's a bug with how we're using Angular. Thanks for pointing it out!
  - wslh 12y ago
    Yes, typical single-page application bug where you need to handle it by itself. Take also into account the possibility of having many tabs opened with different navigation paths.
  - deleted 12y ago
    [deleted]
joosters 12y ago
1) What makes you better than the many existing Bitcoin exchanges? The website doesn't offer any explanation about why a potential customer should choose you over the alternatives. 2) What guarantees or protection do you offer customers for the Bitcoin that you hold? I don't mean in terms of security systems, encryption or any technical details, just what happens if you are hacked and lose coins. Will you reimburse customer losses at all?
- revcbh 12y ago
  1) Compared to exchanges like Bitstamp, we have US banking relationships and can fund accounts via bank transfer in 1-3 days. Generally, wiring funds internationally is much slower and more expensive. Compared to brokers like Coinbase or Circle, we have an order book, so traders can quickly adjust their positions. 2) We're working on insurance for held coins and the ability for customers to maintain full custody of their coins (possibly at the cost of slower trade completion times).
  - bbcbasic 12y ago
    2 could be done as some sort of super-fast escrow service.
    - revcbh 12y ago
      Yeah, that's basically the idea, probably using some multi-sig protocol. It will never be as fast as our internal ledger though, since I think we'd need to wait for at least one confirmation before funding the trade.
- bbcbasic 12y ago
  Good questions, exactly what I am thinking. If I had a bitcoin for every hacked bitcoin company story.
DigitalSea 12y ago
I am a bit reluctant to trust another Bitcoin marketplace. So many of these marketplaces have failed the past year, what reason should people have to trust Buttercoin or think that they are more secure than the likes of Mt. Gox? Being a funded marketplace just means that you are more than likely to be the target of hackers trying to prove a point. I've already lost a little bit this year because of various marketplace collapses. What protections are in place for losses? What are you procedures for storing coins (hot wallets, cold wallets, etc)? Do you have a guarantee you are willing to publicly stick by? Has your marketplace been audited and verified by a third party security firm? How often will you undertake auditing of your marketplace to ensure that it remains secure and funds are safe? If customer coins are ever compromised, will you cover 100% of the losses? I have a few BTC, I would be more than willing to try this out, if you were more forthcoming in regards to security and your guarantees. Being a funded marketplace, I would like to think you built a decent and secure environment for Buttercoin as well as got the site audited independently by a third party security firm who perhaps specialise in financial/marketplace scripts. I am not trying to be cynical here, Buttercoin looks great, but you can understand given the losses I have endured the past year, that I am very very hesitant to trusting another marketplace and I assume there are many out there like me who have been burnt the last year. My trust in all coin marketplaces has been broken, I just need the public reassurance you will do things differently and your policies/procedures before I move any of my BTC.
- revcbh 12y ago
  We have been audited by independent security professionals and will continue to undergo frequent security testing (both code reviews and adversarial testing). I'll try to make the results of that more public, since you obviously shouldn't just take my word for it. To protect against losses we're working to get insurance for deposits setup, but it's not in place yet. We're also looking at the possibility of letting people maintain custody of their coins if they don't need realtime trading. Proof-of-reserve is also planned soon to guarantee that all accounts are fully funded. Right now, the vast majority of coins we control are in cold-storage wallets that require 4+ people to access, with most of the rest in cold-storage wallets that require 2 people to access. Only a very small amount is in a hot wallet. We're working with a partner to add custodial multi-sig to our hot wallet (and maybe cold wallets) so that even if someone compromises our machine, there's an external signatory which will be able to prevent transactions from processing. You're right to be cautious. Even though I keep most of my bitcoins on Buttercoin, in general I wouldn't recommend that anyone use a centralized service for long-term storage. We know that people will do that though, so our security has to be up to par. Hopefully the features we roll out over the next 3-6 months will create enough transparency that you can trust us.
jackmaney 12y ago
I wonder if Professor Chaos had a hand in this...
- revcbh 12y ago
  Ha! I wish ChangeTip supported HN.
roywiggins 12y ago
> a team that cares about it's customers *its http://grammarist.com/spelling/its-its/ http://grammarist.com/spelling/its-its/
- revcbh 12y ago
  Good catch, thanks.
mhluongo 12y ago
We've been using Buttercoin for a little while now- very pleased with the service so far!
pazimzadeh 12y ago
Free trading, but "There is a fee of 0.5% + $0.38 per transaction" charged by the payment processor to add money to the account.
- revcbh 12y ago
  Yep. That fee is still competitive even if you're just buying and holding, but we're geared more towards traders. We're working with our partners to improve the cost structure so that we don't have to charge deposit fees.
_cpancake 12y ago
Isn't this the one that turned out to be a scam? https://github.com/buttercoin/buttercoin/issues/71 https://github.com/buttercoin/buttercoin/issues/71
- revcbh 12y ago
  Nope, although PartTimeLegend is obviously quite disgruntled for some reason I've never entirely been clear on. Nobody was removed from the project on GitHub for over a year after there was last active development. We only took people off of it when some started acting in a disruptive or aggressive manner. Anyone that still wanted to work on that project (buttercoin/buttercoin) was invited to let us know and we would give them access or transfer the repo to them. That repo was the initial open source attempt at a better trade engine in node. It suffered from too-many-cooks syndrome after being started as an announce-first project. There was no clear direction, some people wanted it to be a distributed market, etc. After a couple of months, we thought it would be best to start from scratch with a small team on a focused implementation in Scala. That's available at http://github.com/buttercoin/engine http://github.com/buttercoin/engine. The other contentious point was bitcoins that were donated. We posted a couple of times over the course of the year that anyone who had donated should get in touch with us to have their coins returned as the original project looked dead. Nobody contacted us, so we decided the best course of action was to simply return the coins to the address they came from. That irritated a couple of people, but I still think it was the right thing to do, especially as the person who had originally collected donations had left and there was no clear governance setup for their use. The original impetus for the project was to create a more robust and secure way for people to access bitcoin liquidity. Specifically in the US, since that's where people seemed to be having the hardest time getting money in and out of other platforms. In that respect we've succeeding. We're also still committed to open sourcing as much as we can and will continue to expand the buttercoin/engine repo.

69 points by revcbh 12y ago

We're finally open for anyone to signup, so we're celebrating with free trading. Please write bots, we've got a pretty good API. The open source re-release of the engine is also back up for anyone that wants to play with it: https://github.com/buttercoin/engine https://github.com/buttercoin/engine

theavatare 12y ago

Congrats! Looking snazzy.

kyu 12y ago

Congrats on the launch!

modeless 12y ago

It's a bit strange that Alexis Ohanian is listed as an "investor" in the page and also as a "founder" in the footer. I guess the footer isn't intended to mean that he's a founder of Buttercoin, but it sure is easy to misread it that way.

revcbh 12y ago
Thanks for pointing that out. I'll try to make it more clear.
- modeless 12y ago
  Thanks for making Buttercoin! It looks great and I'll certainly be using it the next time I exchange bitcoins.
shakethemonkey 12y ago
Also I am not sure how this[1] fits in. I remember Paul Bohm being the founder or co-founder of Buttercoin, but his name is absent. [1] https://www.youtube.com/watch?v=YLoVikMXBeA https://www.youtube.com/watch?v=YLoVikMXBeA
- lowglow 12y ago
  At one point he was a co-founder. He has since left.
  - shakethemonkey 12y ago
    History was rewritten, then? You can't just un-co-founder someone. In unrelated news, we have always been at war with Eastasia.
    - revcbh 12y ago
      Paul left after a couple of months and hasn't been involved with the project for about a year and a half. None of the design or code is based on the original open source effort which he started. We're not trying to hide history, he just doesn't want people thinking he's associated with it anymore.
- revcbh 12y ago
  Paul started the effort to build an open source trade engine and had buttercoin.com lying around. We joined up with him a couple of days after he announced the idea and started working on it. Cedric and I already had an interview lined up for YC, but we all thought it was a good enough idea to add Paul and change the idea we were applying with. Unfortunately things didn't work out and the original open source effort died off when we decided to start with a fresh implementation. We just recently release the engine we're using (with some minor tweaks) under an MIT license here: https://github.com/buttercoin/engine https://github.com/buttercoin/engine. We'll be backporting a bit more functionality until we can actually run it in production.

elyrly 12y ago

Thanks for the talk (Bennett Hoffman) yesterday @ Bitcoin meetup yesterday. Looking forward to the additional features to be rolled out.

joeyspn 12y ago

"Unfortunately Buttercoin is not accessible from your location" [0] Europe/Spain [0] https://s3.amazonaws.com/static.buttercoin.com/location-not-supported.html#/setup?r=D6YDrSLZ6GX https://s3.amazonaws.com/static.buttercoin.com/location-not-...

LukeFitzpatrick 12y ago
Same here, assume on the U.S.
eof 12y ago
AML, presumably?
- revcbh 12y ago
  It has to do with banking and regulation. Adding new regions takes a lot of time and effort to get right, but we're working on it.
revcbh 12y ago
Yeah, we're working to expand coverage and bank relationships outside of the US. I can't give any specific timeline, but it's one of our highest priorities.

Alupis 12y ago

Very annoying that they break the browser back button... (it just reloads the page)

0x0 12y ago
Not only that but the back button shenanigans seems to actually have caused the HN favicon in MobileSafari new tab screen to be replaced with their bitcoin logo!
- revcbh 12y ago
  Ha, I'll have to try that. Does it use our icon even if you just navigate to HN directly?
  - Alupis 12y ago
    Could call that a feature ;P
kenrikm 12y ago
Usually I associate sites that break the back button as untrustworthy (Spam, Porn, Porn Spam, Malware). Not a great first impression considering, you know bitcoin, money and all of the fraud that has been associated with it to this point.
revcbh 12y ago
Oops, that's a bug with how we're using Angular. Thanks for pointing it out!
- wslh 12y ago
  Yes, typical single-page application bug where you need to handle it by itself. Take also into account the possibility of having many tabs opened with different navigation paths.
- deleted 12y ago
  [deleted]

joosters 12y ago

1) What makes you better than the many existing Bitcoin exchanges? The website doesn't offer any explanation about why a potential customer should choose you over the alternatives. 2) What guarantees or protection do you offer customers for the Bitcoin that you hold? I don't mean in terms of security systems, encryption or any technical details, just what happens if you are hacked and lose coins. Will you reimburse customer losses at all?

revcbh 12y ago
1) Compared to exchanges like Bitstamp, we have US banking relationships and can fund accounts via bank transfer in 1-3 days. Generally, wiring funds internationally is much slower and more expensive. Compared to brokers like Coinbase or Circle, we have an order book, so traders can quickly adjust their positions. 2) We're working on insurance for held coins and the ability for customers to maintain full custody of their coins (possibly at the cost of slower trade completion times).
- bbcbasic 12y ago
  2 could be done as some sort of super-fast escrow service.
  - revcbh 12y ago
    Yeah, that's basically the idea, probably using some multi-sig protocol. It will never be as fast as our internal ledger though, since I think we'd need to wait for at least one confirmation before funding the trade.
bbcbasic 12y ago
Good questions, exactly what I am thinking. If I had a bitcoin for every hacked bitcoin company story.

DigitalSea 12y ago

I am a bit reluctant to trust another Bitcoin marketplace. So many of these marketplaces have failed the past year, what reason should people have to trust Buttercoin or think that they are more secure than the likes of Mt. Gox? Being a funded marketplace just means that you are more than likely to be the target of hackers trying to prove a point. I've already lost a little bit this year because of various marketplace collapses. What protections are in place for losses? What are you procedures for storing coins (hot wallets, cold wallets, etc)? Do you have a guarantee you are willing to publicly stick by? Has your marketplace been audited and verified by a third party security firm? How often will you undertake auditing of your marketplace to ensure that it remains secure and funds are safe? If customer coins are ever compromised, will you cover 100% of the losses? I have a few BTC, I would be more than willing to try this out, if you were more forthcoming in regards to security and your guarantees. Being a funded marketplace, I would like to think you built a decent and secure environment for Buttercoin as well as got the site audited independently by a third party security firm who perhaps specialise in financial/marketplace scripts. I am not trying to be cynical here, Buttercoin looks great, but you can understand given the losses I have endured the past year, that I am very very hesitant to trusting another marketplace and I assume there are many out there like me who have been burnt the last year. My trust in all coin marketplaces has been broken, I just need the public reassurance you will do things differently and your policies/procedures before I move any of my BTC.

revcbh 12y ago
We have been audited by independent security professionals and will continue to undergo frequent security testing (both code reviews and adversarial testing). I'll try to make the results of that more public, since you obviously shouldn't just take my word for it. To protect against losses we're working to get insurance for deposits setup, but it's not in place yet. We're also looking at the possibility of letting people maintain custody of their coins if they don't need realtime trading. Proof-of-reserve is also planned soon to guarantee that all accounts are fully funded. Right now, the vast majority of coins we control are in cold-storage wallets that require 4+ people to access, with most of the rest in cold-storage wallets that require 2 people to access. Only a very small amount is in a hot wallet. We're working with a partner to add custodial multi-sig to our hot wallet (and maybe cold wallets) so that even if someone compromises our machine, there's an external signatory which will be able to prevent transactions from processing. You're right to be cautious. Even though I keep most of my bitcoins on Buttercoin, in general I wouldn't recommend that anyone use a centralized service for long-term storage. We know that people will do that though, so our security has to be up to par. Hopefully the features we roll out over the next 3-6 months will create enough transparency that you can trust us.

jackmaney 12y ago

I wonder if Professor Chaos had a hand in this...

revcbh 12y ago
Ha! I wish ChangeTip supported HN.

roywiggins 12y ago

> a team that cares about it's customers *its http://grammarist.com/spelling/its-its/ http://grammarist.com/spelling/its-its/

revcbh 12y ago
Good catch, thanks.

mhluongo 12y ago

We've been using Buttercoin for a little while now- very pleased with the service so far!

pazimzadeh 12y ago

Free trading, but "There is a fee of 0.5% + $0.38 per transaction" charged by the payment processor to add money to the account.

revcbh 12y ago
Yep. That fee is still competitive even if you're just buying and holding, but we're geared more towards traders. We're working with our partners to improve the cost structure so that we don't have to charge deposit fees.

_cpancake 12y ago

Isn't this the one that turned out to be a scam? https://github.com/buttercoin/buttercoin/issues/71 https://github.com/buttercoin/buttercoin/issues/71

revcbh 12y ago
Nope, although PartTimeLegend is obviously quite disgruntled for some reason I've never entirely been clear on. Nobody was removed from the project on GitHub for over a year after there was last active development. We only took people off of it when some started acting in a disruptive or aggressive manner. Anyone that still wanted to work on that project (buttercoin/buttercoin) was invited to let us know and we would give them access or transfer the repo to them. That repo was the initial open source attempt at a better trade engine in node. It suffered from too-many-cooks syndrome after being started as an announce-first project. There was no clear direction, some people wanted it to be a distributed market, etc. After a couple of months, we thought it would be best to start from scratch with a small team on a focused implementation in Scala. That's available at http://github.com/buttercoin/engine http://github.com/buttercoin/engine. The other contentious point was bitcoins that were donated. We posted a couple of times over the course of the year that anyone who had donated should get in touch with us to have their coins returned as the original project looked dead. Nobody contacted us, so we decided the best course of action was to simply return the coins to the address they came from. That irritated a couple of people, but I still think it was the right thing to do, especially as the person who had originally collected donations had left and there was no clear governance setup for their use. The original impetus for the project was to create a more robust and secure way for people to access bitcoin liquidity. Specifically in the US, since that's where people seemed to be having the hardest time getting money in and out of other platforms. In that respect we've succeeding. We're also still committed to open sourcing as much as we can and will continue to expand the buttercoin/engine repo.