I think that I fought for user privacy much more vigorously than most sites would in this situation, and I still had to release a lot of private data.

The administrator of the world’s most popular bitcoin forum, bitcointalk.org, told users that he was forced by a subpoena to release 600 people’s private messages.

Michael Marquadt, a.k.a. theymos, told affected users that he would mark the information as confidential, but that may not be enough to keep it from going public. He goes on to clarify in the message, “In particular, I believe that BFL has full access to the PMs and could choose to release them.”

The bulk message was sent out to anyone who interacted with the Butterfly Labs staff accounts on the forums. Any messages – even deleted ones – sent to the following accounts may have been released:

Inaba

BFL-Engineer

BFL_Josh

SLok

BFL_Sonny

BFL AM

Dave

bcp19

nibbknot

Forum administrator responds

CoinBuzz reached out to Marquadt (theymos) for more information:

When were you asked to release the PMs?

The subpoena is dated March 3.

Whom were you asked by?

Subpoenas are always sent by a government, usually a court. You can’t just go and send someone a subpoena. This one was issued by the US District Court for the District of Kansas. It is related to case number 14-CV-2159-KHV-JPO.

Are you concerned about what might be done with the PMs you provided?

Yes. That’s why I spent so much time/money reducing the number of PMs I would have to release to the bare minimum. (The subpoena originally requested all PMs that even mentioned BFL, from/to anyone.) Only PMs to/from a few people who (apparently) are/were BFL employees were released. The PMs are also covered by a protective order, which should make it somewhat more difficult for the PMs to become public.

Even though I want to protect forum PMs as much as I can, users of any website should be aware that it is basically impossible for any service to completely protect data that you give them access to. For example, if Google received a similar subpeona saying, “Give us all GMail emails talking about BFL,” it seems plausible to me that they might give up this info without any fight at all, and maybe not even tell the affected users about it.

I think that I fought for user privacy much more vigorously than most sites would in this situation, and I still had to release a lot of private data. Therefore, you should always securely encrypt sensitive information before putting it on the Internet. Don’t trust third-parties with anything important.

Are you concerned about how BFL might respond to this?

I treated both BFL and the plantiff fairly here. They don’t have any reason to be upset with me.

I am somewhat concerned that BFL could get some info about people who were anti-BFL and use this against them somehow. For example, perhaps some of released PMs show that an ex-BFL-employee broke an NDA. (This is just an example — I haven’t actually read most of the released PMs, and I didn’t observe anything like this in what I did read.) This is unavoidable, unfortunately.

What is your opinion on Butterfly Labs in general?

As far as I know, they accepted substantial preorders and then failed to deliver in any reasonable timeframe. This is very bad. But whether this was due to bad luck, incompetence, or malice, I don’t know.

Community response

We also contacted an affected user of the Bitcoin community to see what they thought about ButterFly Labs as a company:

I had high hopes for BFL when I first purchased their first ASIC mining machine. So did A LOT of people. I put too much faith in BFL as I’d dealt with Inaba when he was running Eclipse Mining Pool. We were all promised SO much, but we were strung along a lot more. People got angry and rightly so. It looks as though BFL may have been bullshitting customers on purpose. Investigations will hopefully reveal if they were misleading customers because they were either incompetent or stealing customers coins through mining with their machines. I think that they screwed everyone over for their own greed. I despise liars and theives, so I hope they get what’s coming to them! /u/DobZombie | Reddit

The long and troubled past of ButterFly Labs

ButterFly Labs are perhaps the most infamous company in the Bitcoin space. For years they’ve been the centre of controversy, due to their long history of false promises, unreasonable delays, and unpopular customer service. In September of 2014 the mining hardware manufacturers were shut down by the Federal Trade Commission. They proceeded to reopen in January and set a timetable for shipping their Monarch hardware and issuing refunds to some customers, but this recent development suggests that they are still being investigated.