During the past two weeks I experienced two attempts by scammers to steal domain names, by offering payments in cryptocurrency.
These Bitcoin scammers offered to acquire premium domains by indicating they can only make payments in BTC.
There is a reason why such a method of exchanging domains for money isn’t supported by the Uniregistry Market. There is no safety process to validate the source of payment, and anonymity – while a welcome feature in many circumstances – can also be a safe method to commit a crime and hide behind it.
Payments in cryptocurrency can remain in limbo and if not careful, the party with the domain name can falsely believe that a transaction has been confirmed. There are ways to delay the confirmation of the payment, and to the uninitiated it can lead to a complete loss of the domain.
There are services out there that play the role of an escrow in order to process payments in BTC but they are not true escrow services, and I am very reluctant to use them. Escrow.com does not allow transactions in cryptocurrency and that’s an indication of what constitutes a trackable exchange that protects both the buyer and the seller.
Bottom line: payments in FIAT are preferred, as they almost certainly arrive with validation of the parties’ identities. While it’s possible to transact in BTC and other cryptocurrencies, I would not advise anyone to do so if they aren’t 100% certain of the other party’s identity and intentions.
What is the risk if you make them pay first? They can’t reverse a bitcoin transaction to, for example, your Coinbase account. The risk is all on the buyer. You hold the domain until the bitcoin is in your account.
What’s the scam here? As long as the buyer pays first, I see no problem. Btc payments are irreversible…
BTC transactions can remain unconfirmed long enough to trick the uninitiated into transferring the domain. Also, read this: https://blog.elidourado.com/stop-saying-bitcoin-transactions-arent-reversible-51a74003e226
Yes, if you do not know what you are doing, you can be scammed by any ‘payment method’. Fake pdf’s of bank wires, fake emails from escrow or a marketplace, fake hard currency, whatever. BTC on the other hand is way more secure. Why would you transfer a name before an appropriate number of confirmations? Makes no sense.
Laughable link. That’s about multisignature transactions that are clearly set up as such where you agree to only have 1/nth say over the funds.
Steven – You can’t seriously compare the two, an anonymous pseudocurrency and a process where the parties are forced to reveal their confirmed identities using real money.
No, I would not recommend such transactions, unless the funds are sent from a person I trust 100%.