ASIC bitcoin miner manufacturer TerraHash has told customers that it has gone out of business. The company is now facing legal action from at least two customers,CoinDesk has learned.

The California-registered corporation announced on the Bitcointalk forum that several problems had caused it to cease trading.

“The failure of the Klondike project was one. Chase,our bank,shut down our accounts. Also the delay in the shipment of the chips has resulted in a lot of customers asking for [a] refund, ” said someone using the TerraHash account in the official TerraHash forum.

“We already owe a lot of money to PayPal,and with all the refund requests,it is impossible for us to continue our operation profitably. So we have decided to dissolve the company.”

The company was one of several that was awaiting processor shipments from BitSynCom,which has repeatedly delayed shipments of the Avalon ASICs. It was to use Klondike,a third-party board developer for the ASICs,to house them.

TerraHash,which did not reply to CoinDesk’s request for comment,said in the forum that it would be requesting a refund from Yifu Guo,founder of Avalon ASIC,at which point it would begin refunding orders.

“We will be able to refund about 50% of every order with this amount.We are trying to get our money out of Chase,which will help us refund another ~5% of each order, ” TerraHash continued,adding that it would send additional pro-rated payments to each customer as it got more money back.

What seems clear at this point is that some of the money has been spent,and many customers will only be getting a proportion of their payments back. A crowdsourced spreadsheet showing TerraHash orders has been produced here.

TerraHash had been bullish about its business as recently as three weeks ago,when it announced a hosted mining service,offering up to 2 petahashes of capacity,to come onstream in November. It was negotiating with a manufacturer of 28nm ASICs at the time,it said.

The company had begun taking pre-orders in June,and then closed them again,before subsequently opening preorders for an assembly service for people who had their own chips,requesting a 5% deposit.

The closure leaves many out of pocket,and angry at the company. “It’s a big mess, ” said Emmanuel Abiodun,founder of UK-based hosted mining firm CloudHashing,who had placed orders with the firm. He has now started legal proceedings against individuals associated with the company,he told CoinDesk.

“The biggest issue with TerraHash is they did not do a good job keeping their customers informed. The updates were few and far between, ” said Michael Andrews,a computer consultant who had ordered $11, 500 of equipment from the company on June 18 via PayPal and American Express,and had not yet received a refund.

Source: www.coindesk.com