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Comment by keverets | Hacker News Reader

The trust issue he encountered he mis-attributed to bitcoin when in fact the issue was with paypal and credit cards. Bitcoin is like cash. There's no "reversal" of charges. Once something has been paid for, it's public record and there's no one-sided taking it back. This is a good thing.

The use of Paypal and credit cards destroy this trust by allowing a paying party to reverse transactions so the payee gets nothing. It's empowering a third party to arbitrarily negate charges.

Bitcoin is no more a "den of thieves" than a cash-based society, which most of the world was until recently. I'd argue that Credit Cards and PayPal are much more a den of thieves by abusing their trust to cause no end of issues for people receiving payments.

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You are absolutely right in that it is exactly like cash, and for transactions that are exactly like cash I think Bitcoin is great. But how much commerce is done online now? How big is Amazon.com? How many other online merchants exist?

If Bitcoin's ambitions are only to replace physical cash transactions, then sure, it works. (and that's no small success!) But if we are talking any kind of online transaction with delayed gratification, then trust is required, as is a recourse when things go wrong.

That's a fair point. The difference is in where I think the trust should be placed.

I would love to be able to pay for goods on Amazon with bitcoin, because I trust Amazon. Right now Mastercard/Visa/Paypal takes a cut on each of those transactions to provide "trust" in them that I neither need nor want. If things go wrong in that transaction, I'm still left dealing with Amazon, as Mastercard/Visa/Paypal will not want to get involved.

In cases where you're dealing with an unknown quantity, then you have to look elsewhere for your trust metric. eBay has their, eg. "99% positive" reviews, Silk Road has their own way of dealing with this (similar with freebies/samples to build trust).

Bitcoin is something basic and should not be taken for more. What banks and other services do nowadays is something far more complex, including leveraging trust in a way or another. These kind of services can be built on top of BitCoin. Their business models won't be equivalent in all aspects with what we have now in the current system, but there is enough room and potential for such services to exist/run covering needs. It will be just a better system regarding the corruptible nature, because there won't be an central authority with whom to strike deals under the table and get empowered to "be a necessary evil".

This is an interesting perspective, and one that I hadn't considered. The obvious implication is that Bitcoin should only be used where one currently uses cash. Crucially, this means 100% offline (because even bank transfers require a bank, which Bitcoin doesn't have).

Perhaps the route to success for Bitcoin involves sophisticated offline tools?

> This is a good thing.

Why do you say so, apart from ideology? The history of money and credit transactions suggests the opposite; consumers in fact clamor for transactions to be reversible. Do you have any evidence to support your claim?

You appear to be speaking from a purely consumer perspective. That's being only the client in a client/server relationship, and feeling a need for protection from the supplier.

I'm speaking from being a peer; both a consumer and a supplier at the same time. We are more than consumers, we're people and citizens that provide services and utilize services of others. Having a third party in those transactions that can arbitrarily disrupt them has proven problematic (for reference, see all of the backlash against PayPal for the way they arbitrarily freeze funds on both sides, etc).

ANY merchant provider can hold funds up to 180 days for any reason in the US. It's not just paypal that does that.

> Bitcoin is no more a "den of thieves" than a cash-based society, which most of the world was until recently.

Actually it seems that credit/debt was usually the standard and not cash per se, at least if David Graeber's book on the history of debt can be believed ("Debt: The First 5,000 Years"). While cash has certainly been used since antiquity, most transactions were on credit, even before Western Europe exited the Middle Ages, with cash limited to certain purposes and/or segments of society.

Trade credit (I'll buy these hammers today, bill me next week) is somewhat different from credit cards. Credit cards are a financial tool to provide easy access to temporary funds, and are usually backed by banks, which have only existed for ~500 years. Trade credit is part of the give-and-take of relationships in that we recognize resource ticks aren't always synchronized.

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