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The relay market powering token resellers and fraud
- robluxus 2mo ago> For example, one operator’s price-comparison site listed a package that bought the equivalent of $3,333 worth of official Anthropic credit for 425 RMB — roughly $0.13 of usage per $1 spent. Do these numbers make sense? $0.13 usage per $1 spent?
- zaltekk 2mo agoI think this was very poorly worded. I believe they’re trying to say you pay the reseller $0.13 to get what costs $1 at the upstream provider.
- latchkey 2mo agoIf you are using a stolen credit card to buy tokens and resell them, then the cost per token is the amount the credit card cost you (and building/running the proxy service), not the value of the tokens themselves.
- mlenhard 2mo agoYeah, I should probably clean this up. The sentence is a bit hard to understand. What I was trying to show was the steep discounts offered by resellers.
- jagged-chisel 2mo agoSo $1 of usage for $0.13?
- SyneRyder 2mo agoThat sounds entirely plausible. When I was on the Claude Max $100 plan, I would often get the equivalent of at least $1300 API usage, according to the costs counter in Claude Code. That would be about $1 of usage for every $0.075c. At $1 of usage for $0.13, the reseller is making a tidy profit on top of whatever subscriptions they're reselling.
- mmoskal 2mo agoAlso 425 RMB is about $59 so $1 of tokens for $0.017 not $0.13 (the discount rate quoted also seems off).
- kristjansson 2mo agoseems like they missed a zero somewhere. its a dollar of usage for a penny and change.
- markus_zhang 2mo agoI don't know anything about tokens. Does the following argument make sense? 1. Tokens are model-specific: e.g. tokens used by Anthropic cannot be used in models of other companies. 2. Tokens are generated by GPU cards. They measure the power of GPU cards. 3. Tokens cannot be separated from the models. You sort of "connect" the software part (models) into the hardware part (GPU cards) to use the tokens generated from the hardware.
- irishcoffee 2mo agoNo, all 3 points are incorrect. I’m not even pro-LLM and I’ll tell you this. You should do a bit of reading on what a token is. The short answer is that it’s a series of 2-4 bytes of information turned into an integer. Your comparisons are akin to asking “are amazon gift cards the same as a bunch of pesos?”
- capitalsigma 2mo agoTokens measure "how much work the model did" in the same way that step counts measure "how far the person went" GPUs "generate tokens" in the same sense that human feet "generate steps" You can't compare token counts across different providers to get an absolute measure of "total work done" for the same reason that you can't compare step counts across different people to get an absolute measure of "total distance traveled"
- lmf4lol 2mo agothats one of the reasons why we vest any of our new customers. We need to know you before you are allowed to use our agent system. When you have an open sign up with some free credits, all hell breaks loose.
- renezander030 2mo ago[flagged]
- feverzsj 2mo agoToken is the new cryptocurrency.
- hsienchuc 2mo agoI use both of subscription and API services. on last month, i chat with CLI and let it to do something. After that, maybe in one days pass, i received the $32 USD bill. it cause my left my API key and CLI call the API to do job not through subscription.
- altmanaltman 2mo ago"Token reseller market" is a fancy way of saying credit card fraud. If someone stole xboxs from stores using stolen credit cards and then sold them at 10% of their price, at what point is it a "resller market" and not "criminal enterpirse"?
- iansmith_hn 2mo agoFair enough. Is the right enforcement then to ignore the "token resellers" and go after the credit card business listed at the "upstream" on his post?
- __MatrixMan__ 2mo agoWith theft, somebody ends up without an Xbox. Theft is wrong. This is mere breach of contract, whether it's wrong depends on the contract.
- raincole 2mo agoIn your world model, hardware and electricity are made out of thin air?
- zht 2mo agoWhat?
- phildenhoff 2mo agoIt's not _theft_ because nothing is _stolen_. The tokens are being used in a way that breaches the contract agreed to by whomever set up the account with OpenAI, Anthropic, Kilo, Antigravity etc. but it's not theft.
- chasd00 2mo agoThe credit card and the money is what was stolen.
- 2mo ago
- benlivengood 2mo agoThe real problem is subscription models. Businesses want recurring revenue so they try to game the ratio of fixed subscription prices to COGS but it's always a game and so whoever can figure out the upside for the company can figure out the complementary upside for themselves. How would one even word a bulletproof subscription contract for agentic tokens, anyway? You can't forbid automation because sub-agents are automation. You could forbid "using tokens for the benefit of more than the human who signed up" but then what do families (especially with kids) need to do? What if your friend asks you a question and you turn to a chat model? Forbidding "reselling" tokens outside of a household sounds like the closest terms but that's leaky for anyone who travels a lot, etc. Fixed cost per token simply works.
- PunchyHamster 2mo ago> How would one even word a bulletproof subscription contract for agentic tokens, anyway? You can't forbid automation because sub-agents are automation. You could forbid "using tokens for the benefit of more than the human who signed up" but then what do families (especially with kids) need to do? What if your friend asks you a question and you turn to a chat model? Forbidding "reselling" tokens outside of a household sounds like the closest terms but that's leaky for anyone who travels a lot, etc. reverse the pricing structure; give modest discount once you go over certain amount of tokens, then you are incentivized NOT to start multiple accounts. require first few transactions to be pre-paid to get around at least some of the card problems. Of course, that would fuck over subsidized plans, but I don't see any option to keep them if you want to avoid the flood
- nfbdhdfbf 2mo ago> You can't forbid automation because sub-agents are automation. Is this some kind of attempt to make the other side look better by making the worst argument you can?
- PunchyHamster 2mo ago....ask the original poster not me ? I just quoted him
- bg24 2mo agoNice research and structuring into 4-tier layer. For providers like Anthropic and OpenAI, subscription is the entry point for all these, right? Besides the measures proposed in the article, can token usage % determine these clusters of accounts?
- jfim 2mo agoThere are probably various metrics like language used to prompt the model, number of hours per day spent prompting, and many others. There are quite a few other mitigations that could be done by providers that aren't mentioned in the article.
- namanyayg 2mo agoOne aspect that seems to be missing is the abuse of the free credits provided for new companies by AWS, Azure, and other providers. I know of a friend's company in India who purchased inference, at 4% of the actual price and states that it gave him an unbeatable competitive edge in their large running video influence pipelines. Any new competitors could not offer their pricing at all. Primarily that operated because registering a new company getting free AWS credits was a very tiny cost
- 4848488448 2mo agothe in India wasnt even needed no worries
- cumshitpiss 2mo ago[dead]
- ac2u 2mo agoSome countries have more complexity to registering a new company than others, and perhaps it’s the establishment of a new legal entity that is an unlocker to the free credits. I don’t know if that’s true of India or not, but I like to give comment authors the benefit of the doubt that being specific about the geography was helpful context here
- manquer 2mo agoIndia is very bureaucratic and slow for starting a new business new entity. It ranked 63rd on the most recent world bank survey of 2020[1], and it is even more painful to close one. [1 ]https://openknowledge.worldbank.org/entities/publication/130bd2f3-f4b5-5b77-8680-01e6d6a87222 https://openknowledge.worldbank.org/entities/publication/130...
- cannonpr 2mo agoSo that report was discontinued after relatively proven statistical gaming and interference by several countries, doesn’t exist post 2020. Post 2020 SPICE+ launched making registration trivially fast. However really the trick isn’t creating and closing companies, it’s that the fact majority of reporting that would catch scam companies like these just get ignored and gather small civil penalties payable years later or not at all, while keeping up with major reporting that might close their bank accounts… it’s a very disorganised system that facilitates a lot of unpleasant activity.
- mito88 2mo agowhat tokens are these being sold?
- deleted 2mo ago[deleted]
- receptopalak 2mo ago[flagged]
- wtobey1 2mo agoI spent years working on financial integrity at a large ads company and this isn't novel at all! The same resale markets are at play for the last generation of internet giant's products. Highly sophisticated actors, able to cobble together impressions through abuse of the billing systems, stolen financial instruments, taken over accounts, etc, create massive markets of discounted impressions for resale. It was very interesting to compete against them as we hardened our defenses and they invented new ways to exploit them. I imagine the same defensive tools and techniques are being deployed by my former colleagues who moved to the labs.
- skybrian 2mo agoYes, and I'm reminded of Bitcoin miners relocating for subsidized electricity or even stealing it outright.
- grinich 2mo agoThis is the problem we've been working on solving with WorkOS Radar. We run it for Cursor and a bunch of other AI companies who have a free trial that gives some free inference to test the product. It turns out to be a pretty complex program to solve at scale. Token fraud is a lucrative market and the adversaries are surprisingly sophisticated. It's a cat-and-mouse game, accelerated with AI. https://workos.com/radar https://workos.com/radar (If you'd like to work on this, we are hiring :))
- mlenhard 2mo agoI don't think device fingerprinting is the right approach here. Client-side detection can always be sidestepped, and you need to intermediate the actual inference to get enough signals to make an accurate prediction. There are hundreds of listings for cursor tokens/credits right now. We use canary values to detect the resellers, and I believe that's the only approach that will actually work at scale.
- reliabilityguy 2mo ago> We use canary values to detect the resellers, and I believe that's the only approach that will actually work at scale. Can you elaborate how it works? Specific sequence of tokens acts as a canary?
- nikcub 2mo agosign up for the resellers, insert a random id canary into your requests, trace them back on your server to tie it to an account find fingerprints / signatures of the accounts being used. ban all of them. eventually build an ml based system that detects these at signup reinforce with more data. loop forever, etc.
- grinich 2mo agoWe do a lot more than device fingerprinting including training custom fraud models. We don't broadly publish our techniques for detection since that would make them much easier to circumvent.
- blfr 2mo agoHow do the users know they're getting what they're paying for? I disabled automatic downgrading/rerouting because it sometimes takes me a second to tell when the answer came from a different model than I wanted. You could easily sell Opus as Fable for a good while.
- gruez 2mo agoYou can't, it's all reputation based. Similar to whether drug users don't really know what they got were diluted or not.
- TurdF3rguson 2mo agoI think the drug users will know before the Opus users.
- inigyou 2mo agoAt most big festivals there is free drug testing by harm reduction charities. Not that they'll test you for drugs, but they'll test your drugs to make sure they are what you think they are. At Fusion Festival, I saw a big bulletin board completely covered in notices of "we tested this pill, here's a photo, here's what they thought was in it, here's what was actually in it" They also spelled the name of the charity wrong on all the maps, so that's nice.
- byzantinegene 2mo agoi doubt the users really care as long as they get the job done, AI in 90% of use cases is just a race to the bottom, nobody cares as long as it's cheap and gets the job done.
- cobzilla 2mo agoThis article is about the mechanics, but the title implies this is unethical. Why is this practice considered unethical?
- faeyanpiraat 2mo agoIs it ethical?
- imp0cat 2mo agoIt's token piracy, plain and simple.
- chihuahua 2mo agoUsing stolen credit cards, or chargebacks, to buy something, and then resell that thing, for profit. "Why is this practice considered unethical?" Next week: Shoplifting batteries and laundry detergent, and reselling it on Ebay. "Why is this practice considered unethical?"
- rustyhancock 2mo agoAren't these figures the wrong way around "$0.13 of usage per $1 spent" So I spend a dollar and I get 13 cents worth of usage? I guess it means the otherway around but I'm not seeing how that phrasing works. Are they paying a premium to access US models?
- simonw 2mo agoThis is pretty fascinating! Here are the two open source proxies listed in the article: https://github.com/songquanpeng/one-api https://github.com/songquanpeng/one-api and https://github.com/QuantumNous/new-api https://github.com/QuantumNous/new-api
- iririririr 2mo agowow. Ai providers can't solve fraud 101 with their oh-so-dangerous-if-released-models? i think this alone is the biggest bear signal
- ifwinterco 2mo agoIt's the same fundamental problem as "ticket touting" for popular events - if you sell something that's in demand at a price that's far lower than the clearing price of the market, you're creating a juicy arbitrage opportunity that sooner or later somebody is going to try and exploit
- hahahaa 2mo agoYeah but those tickets are never a loss leader. So it feels different. This is more like sharing Argentinan $2/m Google Premium subscriptions via a load balancer.
- miki123211 2mo agoNot necessarily. What OpenAI and Anthropic are selling — a flat-rate subscription with both 5-hour and weekly rate limits — is a bit like an all-you-can-eat buffet. They expect some customers to generate more in costs than they bring in revenue, just like some people at the all-you-can-eat buffet eat more than they pay for, but by the law of large numbers, the mean cost per customer comes out to something the labs are comfortable with. What the resellers are doing is undermining the labs' assumptions that every person needs to eat and sleep, and hence won't use every 5-hour window to the fullest. It's the equivalent of buing the all-you-can-eat pass for one person, coming into the restaurant with three of the largest suitcases you can find, and filling them to the brim with food, which you later re-sell at much lower prices. In other words, fraud.
- byzantinegene 2mo agofraud that cannot be reliably be prevented, which makes the business model in-question fall into 'questionable' category.
- nswizzle31 2mo agoThis is the same terrible analogy used to justify Anthropic shutting off API access for subscribers. It’s nothing like an all-you-can-eat buffer because, as you mention, there are limits! We are not buying all we can eat. We are buying 3 plates of food every 5 hours (or whatever) and we should be able to do with that food as we please, without anti-consumer tactics to scam us out of not consuming the LIMITS we paid for. Weirdly, no buffet subscriptions exist that I know of. That should tell you a bit about the viability of this business model.. it will collapse if we had to pay the real cost.
- nojs 2mo agoSeems to be an LLM megaexpansion of the actual source (in chinese): https://www.v2ex.com/t/1196011 https://www.v2ex.com/t/1196011
- tancop 2mo agothe way i see it there are 3 types of resellers. the ones using fake credit cards to rack up costs and then cancel the card are doing actual fraud. then you got mass free trial abuse which is more of a gray area and i would say its still wrong. but if you sign up for a subscription, pay for it and resell your monthly tokens thats not at all unethical, even if its breaking their terms and costing the provider money. imagine ford starts renting out company cars at a huge discount so they can get people to buy the same model for themselves after they drive it at work. its the exact same car and costs the same amount to make, they just take a loss on it and use by anyone other than employees is banned in the contract. some small company realizes they dont really use their cars that much so they rent them out again for 3 days a week to get some extra cash. is that fraud? it costs ford nothing because they get the same payments either way, they just lose potential profits. they are the ones who decided to set up a loss leader and take the risk of someone "abusing" the system so we dont need to use public resources to defend their strategy. that wastes taxpayer money to protect corporate profits, and it creates moral hazard because ford (anthropic) is not the one paying for enforcement.
- deleted 2mo ago[deleted]
- miohtama 2mo agoInstead of credit card, prepaid stablecoin purchases would solve the problem. No chargebacks.
- nine_k 2mo agoOr a more pedestrian debit card.
- deleted 2mo ago[deleted]
- Aurornis 2mo ago> some small company realizes they dont really use their cars that much so they rent them out again for 3 days a week to get some extra cash. is that fraud? Most likely, yes. There's a common fallacy that once you pay someone for a service, you are free to do whatever you want with that service. In the case of the rental car, the contract the company entered into would prohibit reselling the services and limit who can drive them and for what purposes. Some people see these limitations and scream "Not fair! They paid money, they can do whatever they want!" The misunderstanding is that the price they paid was predicated on the specific use. They got a lower price for the rentals because the provider calculated the expected use case and priced it according to that. If the small company starts renting out the cars to try to maximize how much they're used, that breaks the financial model. That's why this type of use is forbidden in every basic rental contract. It's the same reason why you can't rent an apartment building and then turn it into an AirBnB. On a smaller scale, it's why you can't go to an all-you-can-eat buffet and load up on food to carry outside to your 5 hungry friends. This type of pricing is everywhere. There is a vocal online minority who believe user license agreements shouldn't be enforced and individuals should never be considered accountable for following them, but that doesn't even apply to these resellers. This isn't a lowly individual user trying to get back $10 from their $20 per month plan that was going unused. There's no way to even achieve the scale and discounts without mass, automated fraud. They're doing chargeback fraud or using stolen credit cards. It's not even a crime where the big corporation is the only victim. The higher the volume of fraud on the subscription accounts, the less real usage you and I get for our dollar. These people are jumping on the accounts targeted to individuals like us and abusing them to sell tokens to big corporations trying to abuse them at scale. People like you and I lose when these accounts get their limits reduced or the companies start introducing ID checks and KYC just to use basic services.
- boznz 2mo agoThe relays sound also like a nice source of monitoring for whoever controls them.
- faeyanpiraat 2mo agoIts so much stuff going through them, how would they monitor it all?
- ericpauley 2mo agoAI is big in GPU terms but in raw bytes the whole token economy is laughably tractable. Case in point: OpenRouter is serving 60T tokens a week, but this is all human text and code (and cache hits!), which is almost certainly compressible enough that you could fit the whole week’s usage on a single hard drive.
- 3eb7988a1663 2mo agoHow do you know the reseller is even giving you the genuine article? Could they be advertising Fable but repacking Deepseek?
- hn8726 2mo agoAbout the same way you'd know Anthropic is getting you the model you picked. Which to me is not really obvious, given clear differences in quality throughout the day and month
- inigyou 2mo agoHow do we define "fraud" if taking a new user discount over and over is fraud?
- hahahaa 2mo agoAh I was wondering how a certain chinese site I came across did this and it could be this. That site offers substantial free tokens, is often reported as being flaky and their affiliate links are popping up on different social medias but look sketchy as anything.
- Havoc 2mo agoHow do the distillation buyers know it's real? Heard that these sort of markets are fond of silently substituting inferior models. i.e. sonnet instead of opus etc. Not unlike narcotics being cut with filler
- chrismarlow9 2mo agoThis is more concerning to me from the perspective of being able to appear as "multiple entities" to the frontier models. My question is do the companies know and are able to detect and consolidate all these accounts as a single actor and just don't care to combat it? Or are they unable to detect this? And if they are unable to detect it wouldn't it be pretty trivial to use this to influence the model overall? I would think there's more money in using it that way.
- 1337h4xx 2mo agoDon't the operators store the agent traces and resell them as training data to AI companies? Why wasn't this mentioned? Did you find any evidence of that?
- chhxdjsj 2mo agoThe chinese AI and greymarket peptides scenes feel so vital, fun and wild-west. Imagine spending your life being beholden to USA corporations and being scolded on HN for violating a trillion dollar company’s ToS.
- weregiraffe 2mo agoImagine having all your data stolen, and then getting a new and exciting autoimmune disease.
- edg5000 2mo agoIf we compare OpenAI subscription prices vs. the cheapest inference providers on OpenRouter, than OpenAI must be losing money. Add the fraud to this and the question is what the future will hold. The only salvation is hardware getting 10x cheaper before the labs run out of money. Otherwise, we'll lose affordable access to bulk tokens.
- jbstack 2mo agoCould you elaborate with examples and numbers?
- weregiraffe 2mo ago[flagged]
- defrost 2mo agoand when did you stop beating your wife? > is the pay good enough to justify the atrocities you help to perpetrate? C'mon, not every ad jockey is flogging fossil fuels, and even some that do repent: https://www.youtube.com/watch?v=jcrekESgFQI https://www.youtube.com/watch?v=jcrekESgFQI * https://en.wikipedia.org/wiki/Peter_Carey_(novelist) https://en.wikipedia.org/wiki/Peter_Carey_(novelist)
- weregiraffe 2mo agoOh, I consider ads-driven economy an atrocity.
- defrost 2mo agoOf possible interest, Ballard's The Atrocity Exhibition is themed abut mass media intrusion into private mind spaces, Carey's Bliss about an ad exec whose heart stops, re-awakening convinced he is in hell (but merely life with the scales fallen from his eyes). Such things are still not reason to dis other HN commentators - there's always reddit for that.
- datsci_est_2015 2mo ago> Such things are still not reason to dis other HN commentators - there's always reddit for that. Mmm, this I disagree with particularly. I view HN as a forum dedicated to the technology professions, and as such, it’s an extremely appropriate place to shame those in the profession who refuse to consider the second-order effects of their work. We (those in the technology profession) have no union through which we can encourage professional standards and ethics and codes of conduct. Shame is pretty much the only and last bastion for those of us who care about how we make our money, and not just the amount written on the paycheck. I know there are some people, both in this forum, and who I’ve met in person - (“Raytheon? How do you feel about the moral dilemma of working for a weapons manufacturer?” … “We manufacture weapons? I just work in HR.”) - who will never lose an ounce of sleep considering their line of work due to an underdeveloped sense of ethics. But there are some people who are in the middle ground who can still be won over. Every year that passes it becomes more important that technologists are aware of the ethical implications of their work - no matter how much capital incentivizes the opposite. Don’t let a paycheck delude you.
- TokenLat 2mo ago[flagged]
- ken_solar 2mo ago[flagged]
- Sattyamjjain 2mo ago[flagged]