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> In high-social-trust situations, there are fewer benefits to blockchains. In low-social-trust situations, people aren't a good option. Bockchains provide an e
by louwrentius 6y ago
> In high-social-trust situations, there are fewer benefits to blockchains. In low-social-trust situations, people aren't a good option. Bockchains provide an entirely new and welcome option for that scenario.
How does this actually work in practice? I've never seen an actual non-convoluted / non-far-fetched case where this would apply.
- meowface 6y agoFor one: irreversible payment. Dealing with lots of scammers as a seller? They can PayPal dispute. They can chargeback. But if they send you cryptocurrency, the money is guaranteed. This doesn't prevent scams in the other direction, but it's something. This is a common problem many independent sellers face when doing legal and legit business.
- louwrentius 6y ago> This doesn't prevent scams in the other direction Which is probably the majority of the actual scam cases. Sellers scamming buyers. So I don't think this is a good case at all.
- seibelj 6y agoI could not disagree more, as someone who operates a niche ecommerce business. The longer I exist, the more reputation I have. But every single customer I sell to is a new risk, and the credit card companies fob all the risk onto me. Crypto payments (which I accept as an option) are great because I have no risk of a charge back a month after I shipped. The risk of being scammed is so much more about anonymous customers than it is of businesses, who need repeat business and word of mouth.
- throwawaywrench 6y agoThe problem is that the risk is borne by honest business owners and honest customers. Scammers exist in both directions and the scammers typically bear none of the risk. Regarding businesses specially, someone operating one or more scam online retailers is actively trying to suppress word of mouth. They also don't care about repeat business because their profit margin is so high. Their process may even specifically include periodically cutting ties with their previous name, websites, vendor accounts etc when victim ill becomes unmanageable.
- seibelj 6y agoIf you choose to purchase from sketchy merchants, you have all sorts of risks regardless of what payment infrastructure is used. As a business that wants to last a long time and attract customers, reputation is everything. People buy from large, established companies for this reason. Crypto payments help all sellers by eliminating an enormous problem of scam buyers using stolen credit cards.
- stale2002 6y agoWell, it is a good case for an honest merchant, that is dealing with people trying to scam them.
- meowface 6y agoI don't know if that's true at all, and I suspect it's false. While both types are not uncommon, I think sellers being scammed is the more common scenario. Even if it wasn't, though, how can you say this isn't useful? Even if 99% of scams were from sellers, the fact that this trivially and provably solves scamming from buyers is amazing. Saying this isn't a good case because cryptocurrency doesn't miraculously universally eliminate the possibility of any fraud from any party in any scenario is really setting a very high bar. And with things like Ethereum smart contracts, you theoretically can prevent fraud from all parties in some cases, and defer all risk to the implementation of the contract. Or do you consider this a bad case as well, because a contract could possibly be flawed and "the majority of fraud isn't actually due to human deceit"?
- projektfu 6y agoI remember when eBay operated on people sending checks to each other. Good times.
- jayd16 6y agoSo it solves this by superseding consumer protections? What does blockchain add here over direct payments, or cash, or even some payment broker with more seller friendly terms? I can't help but assume that regulation will reinforce these protections. Essentially, crypto's major benefit is skirting regulation because its new and that can't last forever.
- meowface 6y agoHow do you propose a direct payment or cash without giving a buyer your bank account number or address, which you may not necessarily want to do for privacy and security reasons? And mailing cash isn't very efficient or practical. Payment brokers are always going to be a point of failure. But also, it's about pragmatism: can you name an existing payment broker that fits the criteria? If not, what option are they left with other than to use cryptography as their broker? But, yes, it's often about avoiding certain kinds of regulation. Regulation isn't inherently good or bad. Some regulation is good in some contexts and some is bad in some contexts. Cryptocurrency lets you enforce your own absolute regulation for cases where legal regulation isn't able to easily help you (like in this scenario).
- koolba 6y agoBlockchain partially solves the problem of laundering illicit funds. The most popular use case I’ve seen is receiving ransoms.
- louwrentius 6y agoMy bad. I've should have added non-criminal. I'm sorry.
- nwah1 6y agoA criminal use is still a use. Some percent of gun sales are for criminal purposes. This counts as market demand just the same as any other sale. Precisely measuring how valuable this is to criminal enterprise is an interesting question. My main area of skepticism regarding this proposed use case is that a blockchain is an immutable public ledger, and thus with enough sleuthing, it is probably quite traceable. Indeed many criminals have later been apprehended through monitoring bitcoin transactions.
- bawolff 6y agoIf it is a non criminal situation, you can generally use traditional methods to establish trust, such as using courts to sue people who rip you off, or using escrow agents, etc. The world has had thousands of years to come up with solutions to trust problems during transactions. They are solutions that work. They work for criminals too, but its a lot harder to use them, especially over the internet, because everyone providing the services goes to jail if they are transacting with criminals.
- halfFact 6y agoVoting and currency are 2 real world situations. Bitcoin isn't convoluted or far fetched even if you really want to disagree. It's nuclear chemistry proof (unlike gold), and outside the reach of government.