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Bitcoin has major scaling problems and is very likely going to fail to deliver on your last sentence. As much as I don't want it to be true, it's more likely th

Bitcoin has major scaling problems and is very likely going to fail to deliver on your last sentence. As much as I don't want it to be true, it's more likely that banks will control the blockchain with something like R3.

bduerst 11y ago
Or how something deflationary that can't handle refunds is supposed to innovate payments.
- belovedeagle 11y ago
  > that can't handle refunds Please stop spreading this idiotic nonsense. Bitcoin, for all its faults, can handle refunds just fine. It just requires a different model than CCs do. You might as well say "cash can't handle refunds"...
  - bduerst 11y ago
    You're right, it requires a multisig escrow scheme which isn't new, unique to Bitcoin, and not innovative to payments, which is the context of this discussion.
  - abalone 11y ago
    They mean Bitcoin can't guarantee refunds if you are ripped off by the seller. Which, of course, neither can cash. Which is why Visa's generally a better way to pay when you don't completely trust the seller (or even when you do).
    - WatchDog 11y ago
      You can utilize bitcoin escrow services. Taking a look at the first service I found [1], the fees, the friction and the short period you can claim a refund within, make it seem like quite an inferior experience to using a credit card. [1] http://safepaybtc.com/ http://safepaybtc.com/
      - bduerst 11y ago
        Except when you need to do a charge back because the good is defective after the first day. Again, multisig escrow isn't new or innovative, and payments have evolved since then. Houses and shipping containers are as good at refunds as Bitcoin because they also use escrow - except their physical nature makes it harder to do infernational scams than with Bitcoin.
      - deleted 11y ago
        [deleted]
      - abalone 11y ago
        Exactly. Escrow charges you 1.5%. Many credit cards pay you 1.5%. And they protect you for upwards of 90 days post-purchase, for free. It's free because it's built around agreements with a central authority that can delegate the power to police and reverse transactions. The whole point of Bitcoin is there's no central authority. So you have to layer on top of that much more expensive protection services, as you would with cash transactions.
        rajacombinator 11y ago
        If it exists, you pay for it one way or another. In the case of credit cards the cost is just obfuscated in the form of higher final prices.
        abalone 11y ago
        No. It is vastly less expensive to have a central authority reverse a transaction by flipping some bits vs. guaranteeing it via escrow or insurance. Additionally the oft-repeated claim that credit card fees lead to higher prices has two problems: 1. When Australia regulated away CC fees, prices did not decline. 2. In the U.S., which has higher interchange rates, most of that is refunded back to the consumer via reward programs (1-2% cashback).
- vonklaus 11y ago
  Things evolve in weird ways, bitcoin doesn't have a perfect way to do refunds, but it does have the ability to do escrow and to be built into contracts. It could be interesting to disallow refunds generally but be explicit in how contracts and purchases are structured so that a transaction is binding after both parties agree and confirm as much to a 3rd party escrow agent. Credit cards, much like HTML, were a good idea built on a preceding ideas looking at the problem they were solving. So while credit cards have evolved, the now appear most similar to the Diner's club implementation popularized in the mid 50s[0] KAZ NEJATIAN did an interesting interview in a YC podcast about his company Kash. He talks about how credit cards work on an antiquated system that, in 90% of transactions (his words) don't use anymore than the expiration date and numbers to process and compares defending processing to building a really strong door without walls. He is neccessarily biased of course, but his explanation of the routing and auth system credit card companies used seems insane, and they aren't even value stores like banks. Point is, things evolve in different ways and in fact, bitcoins lack of refunds (which may or may not even be true), could in fact be a massive innovation. Especially if it could deal with fraud which one could make a case for being the only valid reason for a refund. Not meeting a future obligation, could in fact be settled in the future by escrow or an insurance product one could create. E.g. I buy a laptop with a 5 year warranty and it breaks in year 4. In this contrived example, an issuer could run a system scan and verify this independently and objectively and release a predetermined payment amount, or go to a 3rd party arbitrator who would verify and release the funds. [0]http://www.creditcards.com/credit-card-news/credit-cards-history-1264.php http://www.creditcards.com/credit-card-news/credit-cards-his...
- ChemicalWarfare 11y ago
  Bitcoin handles refunds just fine. There are no chargebacks which is theoretically a selling point for the merchant among with lower tx fees but the refunds are trivial.

bduerst 11y ago

Or how something deflationary that can't handle refunds is supposed to innovate payments.

belovedeagle 11y ago
> that can't handle refunds Please stop spreading this idiotic nonsense. Bitcoin, for all its faults, can handle refunds just fine. It just requires a different model than CCs do. You might as well say "cash can't handle refunds"...
- bduerst 11y ago
  You're right, it requires a multisig escrow scheme which isn't new, unique to Bitcoin, and not innovative to payments, which is the context of this discussion.
- abalone 11y ago
  They mean Bitcoin can't guarantee refunds if you are ripped off by the seller. Which, of course, neither can cash. Which is why Visa's generally a better way to pay when you don't completely trust the seller (or even when you do).
  - WatchDog 11y ago
    You can utilize bitcoin escrow services. Taking a look at the first service I found [1], the fees, the friction and the short period you can claim a refund within, make it seem like quite an inferior experience to using a credit card. [1] http://safepaybtc.com/ http://safepaybtc.com/
    - bduerst 11y ago
      Except when you need to do a charge back because the good is defective after the first day. Again, multisig escrow isn't new or innovative, and payments have evolved since then. Houses and shipping containers are as good at refunds as Bitcoin because they also use escrow - except their physical nature makes it harder to do infernational scams than with Bitcoin.
    - deleted 11y ago
      [deleted]
    - abalone 11y ago
      Exactly. Escrow charges you 1.5%. Many credit cards pay you 1.5%. And they protect you for upwards of 90 days post-purchase, for free. It's free because it's built around agreements with a central authority that can delegate the power to police and reverse transactions. The whole point of Bitcoin is there's no central authority. So you have to layer on top of that much more expensive protection services, as you would with cash transactions.
      - rajacombinator 11y ago
        If it exists, you pay for it one way or another. In the case of credit cards the cost is just obfuscated in the form of higher final prices.
        abalone 11y ago
        No. It is vastly less expensive to have a central authority reverse a transaction by flipping some bits vs. guaranteeing it via escrow or insurance. Additionally the oft-repeated claim that credit card fees lead to higher prices has two problems: 1. When Australia regulated away CC fees, prices did not decline. 2. In the U.S., which has higher interchange rates, most of that is refunded back to the consumer via reward programs (1-2% cashback).
vonklaus 11y ago
Things evolve in weird ways, bitcoin doesn't have a perfect way to do refunds, but it does have the ability to do escrow and to be built into contracts. It could be interesting to disallow refunds generally but be explicit in how contracts and purchases are structured so that a transaction is binding after both parties agree and confirm as much to a 3rd party escrow agent. Credit cards, much like HTML, were a good idea built on a preceding ideas looking at the problem they were solving. So while credit cards have evolved, the now appear most similar to the Diner's club implementation popularized in the mid 50s[0] KAZ NEJATIAN did an interesting interview in a YC podcast about his company Kash. He talks about how credit cards work on an antiquated system that, in 90% of transactions (his words) don't use anymore than the expiration date and numbers to process and compares defending processing to building a really strong door without walls. He is neccessarily biased of course, but his explanation of the routing and auth system credit card companies used seems insane, and they aren't even value stores like banks. Point is, things evolve in different ways and in fact, bitcoins lack of refunds (which may or may not even be true), could in fact be a massive innovation. Especially if it could deal with fraud which one could make a case for being the only valid reason for a refund. Not meeting a future obligation, could in fact be settled in the future by escrow or an insurance product one could create. E.g. I buy a laptop with a 5 year warranty and it breaks in year 4. In this contrived example, an issuer could run a system scan and verify this independently and objectively and release a predetermined payment amount, or go to a 3rd party arbitrator who would verify and release the funds. [0]http://www.creditcards.com/credit-card-news/credit-cards-history-1264.php http://www.creditcards.com/credit-card-news/credit-cards-his...
ChemicalWarfare 11y ago
Bitcoin handles refunds just fine. There are no chargebacks which is theoretically a selling point for the merchant among with lower tx fees but the refunds are trivial.