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> people like you want reversible transactions, and people like me don't. I don’t buy that. Let’s say someone stole your life savings, would you still not want

> people like you want reversible transactions, and people like me don't. I don’t buy that. Let’s say someone stole your life savings, would you still not want reversible transactions? What if someone stole your parent’s or sibling’s life savings?

OiNG 8y ago
not OP, but of course you would. but its a trade off in security between buyers and sellers. Neither is inherently better then the other (imo).
FireBeyond 8y ago
Or someone builds a smart contract that loots the bank (I'm looking at you, Ethereum, even though my description is overly simplistic). Of course they don't. Until they do.
- blotter_paper 8y ago
  Yes, Ethereum gave into the temptation of a special case, redacting code-as-law. But there were some users who understood that this can't be done without undermining the whole system as a social contract, so they didn't go along with the fork. The original, One True Ethereum, is still chugging along as Ethereum Classic.
syrrim 8y ago
Someone always takes the hit. Bitcoin allows you to guarantee that you won't take a hit. Other services can be set up to protect other people as well. I might buy bitcoin with my creditcard, such that if someone fraudulently buys bitcoin on my card, either the cc company or the exchange will reimburse me. As the seller, you don't want to be on the line for such things.
- simias 8y ago
  That's the thing though, I posit that most people (myself included) want some level of guarantee and insurance on their money. That means that in a bitcoin world I wager that most people would actually use third party services to manage their assets. In order to offer a guarantee these services will ask to take over the assets to secure them in their digital vaults. And just like that you've reinvented the banking system. Note that I've seen a few instances of people on HN claiming that they were actually using cryptocurrencies for day-to-day purchases, only to admit that they actually use some kind of off-chain payment method like a coinbase credit card or similar[1]. Congrats, you've got a bank with extra steps. Furthermore I want to point out that this "no refund" policy of cryptocurrencies is by design, there's no way to change that without effectively turning it into a "regular" centralized and "trustful" currency. It's not a feature, it is a technical limitation of the algorithm, the question is just whether it's a problematic one or not. Meanwhile Visa and friends, if threatened, could relatively easily launch a competing product with the same characteristics (no chargeback, buyer pays the fees instead of the seller, etc...). I suspect that the main problem with starting something like that is that it would run afoul of existing regulation. So basically the reason that we're not using Bitcoin-like currency right now is not because we couldn't do it before, it's because we actually realized that we didn't want it. The market has spoken! [1] https://support.coinbase.com/customer/en/portal/articles/2228646-the-shift-card https://support.coinbase.com/customer/en/portal/articles/222...
barnabee 8y ago
If someone steals my life savings I want reversible transactions via the court system, not the settlement layer.
- michaelt 8y ago
  And if the person who stole your life savings can't be found, because they're behind seven proxies?
  - MaxBarraclough 8y ago
    And based in a foreign country with little rule-of-law.
- ABCLAW 8y ago
  No you don't. Because 1) on a personal level you won't be able to pay to avail yourself of the court system, and 2) on a social level the cost of doing fraud screening at the payment processing level is trivial in comparison to the expense associated with fraud litigation.
- maccard 8y ago
  Presumably you're ok with the months and months of time that you'll have to spend going through court to do so? And maybe this might work for you, but what if you don't have months/years (house purchase?) or if you're broke? Or if you've just quit your job and were planning on using the funds to start a company/retire early? Last time I was a victim of financial fraud, a few hundred pounds was taken from my card. Visa noticed before I did, and phoned me, refunded the amount to my account, and replaced my card, without any hassle or action required from me.
- ashelmire 8y ago
  How does the court find them?
sadmikerafles 8y ago
It's easy for us in stable nations to forget that there are many countries that storing your wealth in a bank poses a real risk of corruption, fraud or theft even by governments themselves. Bearer instruments like gold and Bitcoin are important because of the fact that when stored properly they cannot be seized from you by a 'trusted' third party such as a bank and it's exactly because they can't be reversed. It's good that we have both options.
blotter_paper 8y ago
>Let’s say someone stole your life savings, would you still not want reversible transactions? I'm sure I'd want to reverse that transaction if it could be done as a special case with no further implications, but I don't think it would change my mind about reversible transactions in general, and I make the decision to hold a currency/commodity with non-reversible transactions understanding that it could backfire in a scenario like the one you describe. I make this tradeoff in part because it allows me to have funds which cannot be accessed by anyone else without the Randall Monroe method of brute force: https://xkcd.com/538/ https://xkcd.com/538/ This is actually a pretty high bar compared to a system where a bank can be ordered to freeze your account. Nobody can freeze my crypto without breaching my physical security, and personally, I'm willing to accept a good deal of risk for that property. It's okay that you have different priorities.
- landryraccoon 8y ago
  Anyone who has the power to freeze your bank account without recourse already has the power to seize you physically. The IRS, US Government, EU or whomever has jurisdiction over your local bank already has the power and ability to seize your physical person. So I don't see what's being gained; if I put all my bank accounts into bitcoin the people you're trying to guard from can still come and coerce me with a gun anyway. Meanwhile, anybody who isn't one of the aforementioned entities cannot do this, because even if they threaten or kill me, the banking system will reverse the transaction. Thus there isn't any incentive for anybody else to try to physically coerce me, because there's no way for them to keep the money.
  - blotter_paper 8y ago
    Maybe they can, maybe they can't. You're making some non-obvious, generally reasonable assumptions about me. Your statements are true regarding me in the present, but I don't think they've always been true of me, and I don't think they will always be true of me.

OiNG 8y ago

not OP, but of course you would. but its a trade off in security between buyers and sellers. Neither is inherently better then the other (imo).

FireBeyond 8y ago

Or someone builds a smart contract that loots the bank (I'm looking at you, Ethereum, even though my description is overly simplistic). Of course they don't. Until they do.

blotter_paper 8y ago
Yes, Ethereum gave into the temptation of a special case, redacting code-as-law. But there were some users who understood that this can't be done without undermining the whole system as a social contract, so they didn't go along with the fork. The original, One True Ethereum, is still chugging along as Ethereum Classic.

syrrim 8y ago

Someone always takes the hit. Bitcoin allows you to guarantee that you won't take a hit. Other services can be set up to protect other people as well. I might buy bitcoin with my creditcard, such that if someone fraudulently buys bitcoin on my card, either the cc company or the exchange will reimburse me. As the seller, you don't want to be on the line for such things.

simias 8y ago
That's the thing though, I posit that most people (myself included) want some level of guarantee and insurance on their money. That means that in a bitcoin world I wager that most people would actually use third party services to manage their assets. In order to offer a guarantee these services will ask to take over the assets to secure them in their digital vaults. And just like that you've reinvented the banking system. Note that I've seen a few instances of people on HN claiming that they were actually using cryptocurrencies for day-to-day purchases, only to admit that they actually use some kind of off-chain payment method like a coinbase credit card or similar[1]. Congrats, you've got a bank with extra steps. Furthermore I want to point out that this "no refund" policy of cryptocurrencies is by design, there's no way to change that without effectively turning it into a "regular" centralized and "trustful" currency. It's not a feature, it is a technical limitation of the algorithm, the question is just whether it's a problematic one or not. Meanwhile Visa and friends, if threatened, could relatively easily launch a competing product with the same characteristics (no chargeback, buyer pays the fees instead of the seller, etc...). I suspect that the main problem with starting something like that is that it would run afoul of existing regulation. So basically the reason that we're not using Bitcoin-like currency right now is not because we couldn't do it before, it's because we actually realized that we didn't want it. The market has spoken! [1] https://support.coinbase.com/customer/en/portal/articles/2228646-the-shift-card https://support.coinbase.com/customer/en/portal/articles/222...

barnabee 8y ago

If someone steals my life savings I want reversible transactions via the court system, not the settlement layer.

michaelt 8y ago
And if the person who stole your life savings can't be found, because they're behind seven proxies?
- MaxBarraclough 8y ago
  And based in a foreign country with little rule-of-law.
ABCLAW 8y ago
No you don't. Because 1) on a personal level you won't be able to pay to avail yourself of the court system, and 2) on a social level the cost of doing fraud screening at the payment processing level is trivial in comparison to the expense associated with fraud litigation.
maccard 8y ago
Presumably you're ok with the months and months of time that you'll have to spend going through court to do so? And maybe this might work for you, but what if you don't have months/years (house purchase?) or if you're broke? Or if you've just quit your job and were planning on using the funds to start a company/retire early? Last time I was a victim of financial fraud, a few hundred pounds was taken from my card. Visa noticed before I did, and phoned me, refunded the amount to my account, and replaced my card, without any hassle or action required from me.
ashelmire 8y ago
How does the court find them?

sadmikerafles 8y ago

It's easy for us in stable nations to forget that there are many countries that storing your wealth in a bank poses a real risk of corruption, fraud or theft even by governments themselves. Bearer instruments like gold and Bitcoin are important because of the fact that when stored properly they cannot be seized from you by a 'trusted' third party such as a bank and it's exactly because they can't be reversed. It's good that we have both options.

blotter_paper 8y ago

>Let’s say someone stole your life savings, would you still not want reversible transactions? I'm sure I'd want to reverse that transaction if it could be done as a special case with no further implications, but I don't think it would change my mind about reversible transactions in general, and I make the decision to hold a currency/commodity with non-reversible transactions understanding that it could backfire in a scenario like the one you describe. I make this tradeoff in part because it allows me to have funds which cannot be accessed by anyone else without the Randall Monroe method of brute force: https://xkcd.com/538/ https://xkcd.com/538/ This is actually a pretty high bar compared to a system where a bank can be ordered to freeze your account. Nobody can freeze my crypto without breaching my physical security, and personally, I'm willing to accept a good deal of risk for that property. It's okay that you have different priorities.

landryraccoon 8y ago
Anyone who has the power to freeze your bank account without recourse already has the power to seize you physically. The IRS, US Government, EU or whomever has jurisdiction over your local bank already has the power and ability to seize your physical person. So I don't see what's being gained; if I put all my bank accounts into bitcoin the people you're trying to guard from can still come and coerce me with a gun anyway. Meanwhile, anybody who isn't one of the aforementioned entities cannot do this, because even if they threaten or kill me, the banking system will reverse the transaction. Thus there isn't any incentive for anybody else to try to physically coerce me, because there's no way for them to keep the money.
- blotter_paper 8y ago
  Maybe they can, maybe they can't. You're making some non-obvious, generally reasonable assumptions about me. Your statements are true regarding me in the present, but I don't think they've always been true of me, and I don't think they will always be true of me.