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I've been working in the payments industry on and off for 15 years. I am yet to work with a payment method that does not support reversal (except for physical c

I've been working in the payments industry on and off for 15 years. I am yet to work with a payment method that does not support reversal (except for physical cash). As a last resort victims can file chargeback with their issuers or police. To begin with there are several layers of protection built in at acquirer, issuer, network and so on. Almost at each step there's an option to reverse the payment (or issue a compensating transaction) and finally the chargeback and legal recourse. Bear in mind that each of the business process of the current payment systems exists for a reason. They are the result of decades of learnings and trial and error. Are there plans to build equivalent features on Blockchain for crypto currencies? Or do their users have to go through the same painful failures?

ramesh31 5y ago
>Are there plans to build equivalent features on Blockchain for crypto currencies? The entire plan of crypto is to not ever allow that. That's the big innovation.
- _Nat_ 5y ago
  > That's the big innovation. You're right that a lot of folks don't want features like that, though I just had to point out that this isn't an "innovation" by any wild stretch of the imagination, but rather simply a policy in some implementations. It's mutable, too, for both banks and crypto: either could allow/disallow such a policy if those involved cared to make it work that way.
  - saba2008 5y ago
    >simply a policy in some implementations Reversals would mean that there is some authority that can declare arbitrary transaction to be valid or not, and cryptocurrency is exercise in creation of payment system without such trusted party. So no, would not call it simply a policy.
    - _Nat_ 5y ago
      It's definitely a policy, in that it's a design-decision that could be changed to make it operate differently. For example, if a good majority of a crypto-currency's miners elected to fork to a new policy, then it'd just happen. And cryptocurrency isn't really about lacking a trusted-party so much as decentralizing the trusted-party. Which might sound pedantic, but it's an important distinction: there can be an authority that makes decisions, just it'd be decentralized. Future crypto-systems, e.g. probably a next generation that'll replace early systems like Bitcoin, would probably take a smart-contract approach. For example, a payment could be reversed under conditions encoded in a smart-contract. A well-developed system would likely end up including a system of checks-and-balances, appeals, manners of collecting evidence, etc., where trust is decentralized. For example, most folks would generally agree that a mature, well-developed system should allow someone to recover funds extracted from them under threat-of-violence if everyone agrees that that's what happened. That current systems are too limited to make such an obviously-desirable thing happen is an obvious non-ideality. Once someone makes a good system that fixes such problems, in a generally agreeable way that people can trust, it'll likely become a preferred system; it and its clones, etc., would displace older systems, and this whole no-reversible-transactions thing would become a minor footnote in early history.
      - saba2008 5y ago
        >isn't really about lacking a trusted-party It's also about minimizing amount of trust to that party. Only thing bitcoin miners are trusted, is determination of correct chronological order of transactions. >smart-contract approach Yes, and smart contract will just determine whenever transaction was made under threat of violence! >end up including a system of checks-and-balances, appeals, manners of collecting evidence So regular banking, under other name. Also 'collecting evidence' is pretty much incompatible with anonymity, which is cryptocurrency distinguishing feature. >trust is decentralized How is that even supposed to work? Do you expect that every chargeback will be investigated by every mining pool? Or they will have some authority to do it (again, no difference with regular banking) >most folks Most folks are ok with current banking system. Cryptocurrency is a niche product, having completely different trade-offs.
wyldfire 5y ago
> Are there plans to build equivalent features on Blockchain for crypto currencies? No, transactions are irreversible by design. If you want this, what you need is an escrow service. Escrow services can conduct transactions in bitcoin or other cryptocoins. I don't know of one, but I believe that they may exist.
gruez 5y ago
>I am yet to work with a payment method that does not support reversal (except for physical cash). As a last resort victims can file chargeback with their issuers or police. What about the stories of companies being scammed via wire transfer?
- pc86 5y ago
  This isn't a scam, it's robbery/theft, which is an important distinction. If you're robbed at an ATM the bank will make you whole. If someone lies to you and asks for money, you go to an ATM and give it to them, the bank isn't going to do anything about it.
  - dk775 5y ago
    You would consider this robbery/theft? Had an in person sale with money sent over cashapp and they charged me 250 dollars more, as the item received was half of what I expected. This was automotive fluids, not drugs lol. I had stupidly sent the money before I checked. Cashap didn’t do anything and figured I messed up so why go to bank. Hits me a little different now…
- 0xEFF 5y ago
  The only time average people wire money is when they close on a mortgage.
  - yebyen 5y ago
    And for someone that has never done it before, it's absolutely terrifying – probably the most money you've ever spent in your life in a single transaction, with zero visibility into whether the transaction has worked, and fraud warnings in big red letters to let you know that if you're going to get robbed or scammed, it's probably right here that it will happen. And be prepared to wait 24 - 72 hours for final confirmation!
- wmf 5y ago
  Wire transfers can be reversed in some cases but it's not as simple as filing a chargeback; AFAIK it requires cooperation between law enforcement and the recipient bank.
jcpham2 5y ago
reversible payments equals double spending, which is fraud, which is your payments industry. read the white paper start over. do not collect $200
- amarant 5y ago
  Because crypto-weebs would never ever make a mistake, ever. So clearly this is better. Sigh
  - jcpham2 5y ago
    not my protocol, nor am I OP who lacks technical understanding of question asked I guess when I don't answer question nicely enough for the anti-crypto cunts I get downvoted for it, as if HN opinions even matter any more
  - dang 5y ago
    Please do not respond to a bad comment by making thread even worse. That helps nothing and is against the site guidelines in its own right. "Don't feed egregious comments by replying; flag them instead." a.k.a. please don't feed the trolls https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
    - amarant 5y ago
      You might be right, I can never tell the serious people from the trolls when it comes to crypto. And often times the serious ones are even otherwise intelligent. Crypto is like religion in that sense: sometimes the most intelligent people believe the most egregious things! My apologies if I failed to spot what should've been an obvious troll..
- dang 5y ago
  Breaking the site guidelines like this will get you banned on HN. If you wouldn't mind reviewing https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html and sticking to the rules when posting here, we'd be grateful. You've unfortunately done it repeatedly before (e.g. https://news.ycombinator.com/item?id=27207170 https://news.ycombinator.com/item?id=27207170) - this is definitely not cool, so please fix.
Cthulhu_ 5y ago
This article reads like an advert for this service (casa) pushing for similar bank guarantees / insurance as traditional banks, so er. Yeah basically the same thing. I mean if someone steals your cash money there's no way to get it back either.
hn_throwaway_99 5y ago
> Are there plans to build equivalent features on Blockchain for crypto currencies? Basically every crypto enthusiast out there touts the non-reversibility of crypto transactions as its primary feature, not a bug, and that is why I see crypto as generally useless for your average person.
- swiley 5y ago
  It is, bitcoin is cash on the internet. If you want reversible transactions and credit then use a credit card, I'm pretty sure there are credit cards for crypto now and if there aren't there probably will be soon.
- pelario 5y ago
  Not a fan of crypto, but your argument applies to cash, wish is still widely used (not only by shady people ;) )
  - wombatpm 5y ago
    I don’t keep me entire net worth in cash. ATMs have limits, and banks typically require in person presence and reporting when dealing with large amounts of cash. Crypto not so much.
  - linspace 5y ago
    I really don't know anything about the subject but I think stolen cash is much more hard to conceal and to move. It can be marked also and tracked (or so they say in the movies). You need to justify its possession. You cannot go to the airport with an arbitrary amount of money.
    - jhauris 5y ago
      > You cannot go to the airport with an arbitrary amount of money. This is actually a major problem in the U.S. where the fourth amendment is supposed to protect against unreasonable seizure. It is not illegal to carry cash, but federal and local law enforcement agencies will by policy seize cash without charging anyone with a crime. The victim needs to sue to get their money back, and then the agencies use tax-payer dollars to fight it. This is a clear violation of the 4th amendment, but is absolutely rampant. If we don't fix these problems with cash, you can bet they'll come for your crypto when it becomes popular enough.
drcode 5y ago
Ethereum has had a couple of reversible payment systems built over the years, but nobody used them. Non-reversible, immediate, guaranteed transactions are just more convenient outside of a few edge cases
- ubercore 5y ago
  As kind of an outsider to a lot of things payment and crypto, just a normal consumer, I feel like this is a scenario where you don't know you're an edge case until it's too late.
- pc86 5y ago
  "A few edge cases" including the fact that a sizeable chunk of the population will go through extremely convoluted means to steal from you, especially in the case of non-reversible, immediate, and guaranteed transactions?
- user-the-name 5y ago
  Similarly, outside of a few edge cases, it is a lot easier and cheaper to build a house with no fire protection whatsoever.
  - saalweachter 5y ago
    Brakes just make the car go slower or even stop, but the entire purpose of a car is to go and go fast.
theli0nheart 5y ago
Paying by cash is irreversible. That’s how payments were until credit cards and the Internet came along. One of the big innovations of cryptocurrency is allowing for electronic, cash-like payments. To solution to coercing a “reversal” of a transaction is use the legal system.
- Nursie 5y ago
  One of the big innovations of non-crypto payment methods over cash was the ability to reverse. > To solution to coercing a “reversal” of a transaction is use the legal system. Or, just maybe, we could have a system which doesn't need to involve the legal system every time, and protects consumers anyway. Which we have.
  - deleted 5y ago
    [deleted]
  - theli0nheart 5y ago
    > Or, just maybe, we could have a system which doesn't need to involve the legal system every time, and protects consumers anyway. You omitted the part where this solution requires a surcharge of ~3% on every single transaction we make with our credit cards. In a civilized society, this is how transactions work: You research the merchant and judge whether they are trustworthy. You decide they are, and purchase an item from them. If you have a problem with the item, you request a refund. They ask for the product back, and then they send you the refund. Nothing in the above paragraph requires a credit card processor to enable a reversal of funds. If they refuse to provide a refund, that is their choice, but relying upon a central god-like money authority to judge whether they made the "correct" one is bonkers. That's under jurisdiction of the law.
    - Nursie 5y ago
      That’s not an issue in my country where fees are limited. In your civilised society I will never, ever use a new merchant or a small merchant. One vendor that promises easy refunds would be the only place I would ever shop. Small vendors and new vendors can go hang. Hell, it might just kill internet shopping all together. In your civilised society, small business is f*cked. In your civilised society a person who has been ripped off by a merchant who refuses to deal with them or just plain disappears, has to spend time and more money dragging them through the courts, if they can even find them. Your ‘civilised’ society is carte blanche for unscrupulous merchants to rip people off, something which humanity has been dealing with since the dawn of history. We have these systems in place for a reason, and it’s to stop uncivilised merchants from doing what they’ve been doing as long as merchants have existed. You don’t have to take credit cards, by the way, but don’t expect my business if you don’t.
chrisseaton 5y ago
> I am yet to work with a payment method that does not support reversal Is CHAPS reversible? I don’t think it is. Or is it just not exposed as an option to institutions?
- jonahbenton 5y ago
  Most of these systems are not actually reversible at the protocol level. They sometimes offer cancellation at stages prior to settlement. When needed, transactions are most often "reversed" at the governance level.
  - heavenlyblue 5y ago
    Bitcoin is reversible on the same level then.
    - rjmunro 5y ago
      If someone dies with their bitcoin password locked in their head, you can't get the account passed to whoever is named on the will, the coins are locked forever. Maybe a smart contract could help here. If there are no transactions on a wallet for more than some time period, allow the wallet to be unlocked or transferred to a trusted party.
Andrew_nenakhov 5y ago
As a person living in an authoritarian state, the inability of the government or other authority to reverse a payment looks like a very attractive feature to me. Yes, it does have downsides. They just don't look as troublesome as being completely cut off all financial services with a simple stroke of a pen - which was experienced by many members of political opposition in my country. "... but but Drugs! Criminals!" is what common people say at this point, to which I answer that drugs and crime flourished long before Bitcoin came to exist.
- AdmiralAsshat 5y ago
  See: https://en.wikipedia.org/wiki/Four_Horsemen_of_the_Infocalypse https://en.wikipedia.org/wiki/Four_Horsemen_of_the_Infocalyp...
- jayd16 5y ago
  Is the public nature of transaction worrisome to you? Seems like that might also be a political issue.
- prox 5y ago
  This is really the heart of the matter. On hand , yay, great we can subvert nasty states using cryptocoin, but also could undermine legitimate democracies. Swords cuts both ways. No one can deny the wave of ransomware and cryptocoin are not related. How do we balance it so it can provide a net positive for humanity?
  - Andrew_nenakhov 5y ago
    Yeah, nobody ever asked for ransom before cryptocoins. /s Legitimate democracy can't be undermined by an international currency not controlled be the government. In fact, it can be reinforced by it. This issue is very similar to free speech: the good it does by making the government unable to silence political opponents far outweights the harm done by extremists and lunatics of all sorts.
    - user-the-name 5y ago
jpmattia 5y ago
> I am yet to work with a payment method that does not support reversal (except for physical cash). I'm not sure I get your objection: Physical cash is exactly the use case for bitcoin. There will be financial services and other layers built on top of bitcoin, just as it is done for the dollar, and we are seeing the nascent industry now. (Whoever provides insured services first is going to make a mint.)
- raesene9 5y ago
  I thought Bitcoin was more a store of value (e.g. analogous to gold) than a currency similar to physical cash? If so the problem becomes, is your personal security up to defending attackers who want to take your pile of digital gold.
  - jpmattia 5y ago
    > I thought Bitcoin was more a store of value (e.g. analogous to gold) than a currency similar to physical cash? Physical cash is money, and serves the functions of money (see eg https://en.wikipedia.org/wiki/Money#Functions https://en.wikipedia.org/wiki/Money#Functions) Bitcoin does the same. In the nascent crypto world, different areas are using this new money in different ways: The US currently tends to store of value. Other areas (Venezuela, El Salvador) are tending toward medium of exchange. In any case: OP's reversibility-of-transactions is a financial services function, not a "money" function.
joseluis 5y ago
yes, it's being worked on, but it's only apparent if you know where to look, that means in business oriented blockchains. This could be a good starting point: https://coingeek.com/stefan-matthews-on-hashing-it-out-episode-3-blockchain-is-the-perfect-technology-for-regulatory-compliance-video/ https://coingeek.com/stefan-matthews-on-hashing-it-out-episo...
cortesoft 5y ago
Yeah, this is the part of the cryptocurrency I don’t understand… i feel most people are way more likely to need to have a charge reversed because of fraud than to have some payment to them reversed in fraud…why would we want to make the more likely situation impossible to protect against the more rare situation?
- morpheos137 5y ago
  Well obviously core users of Bitcoin like ransomware artists don't want their gainz reversed. Most people who really use (as opposed to hodl) bitcoin outside of speculation are criminals.
devit 5y ago
Transactions have to be irreversible so that law enforcement is impossible, which is the main selling point of cryptocurrencies. Of course that's a downside if you are the one who would like law enforcement to happen (either because you are the victim of a theft or you want to enforce on others). Also fraud can be done with reversible transactions as well, in particular the reversal can be fraudulent; in general, reversible transactions are only really effective if the conveyance of whatever was paid for is also reversible.
- linspace 5y ago
  I thought that the selling point was avoiding centralization. I suppose some measures could be implemented to avoid robbery.
- Nursie 5y ago
  Reversible transactions are effective at building trust in situations where you don’t trust the merchant. If I can reverse a transaction if I get ripped off, I might consider using a smaller or newer vendor. If I can’t then no chance, I’m sticking to the one I trust, even if they don’t have what I want. Reversible payment methods are a huge boon to merchants, whether they realise it or not.
vbuterin 5y ago
The closest thing to those concepts in crypto would be multisig wallets, including more advanced ones that enforce a "daylimit" where a single key can withdraw a small amount but larger amounts require confirmations from multiple keys or a delay during which another key can cancel the transfer. See also this piece by me on social recovery (a related but not quite the same concept): https://vitalik.ca/general/2021/01/11/recovery.html https://vitalik.ca/general/2021/01/11/recovery.html But this is all not quite the same as reversal and makes different tradeoffs.
m3kw9 5y ago
Sort of reminds me of killing flies with a tank gun, they have done hard forks of the block chain for huge sums before.
Tenoke 5y ago
My bank also in theory supports reversing transactions but last two times I've asked them to they didn't do it anyway. Anyway, there's no issue with building and using a service to handle that for you both on top of the currencies and as a smart contract on the blockchain itself. Most current crypto users just don't seem likely to use it as they prefer the control. This might change as the audience changes.
rchaud 5y ago
> Or do their users have to go through the same painful failures? This might actually be the first time for people to learn these lessons. They've been free-riding on the protections that banking regulations provide for all of their lives.
- geofft 5y ago
  To be fair, they haven't been free-riding. Credit cards force prices up by about 3% for a reason, and checking accounts don't give you market yields for a reason. But yes, for me personally, I much prefer deterministically losing 3% to risking 100% (and incentivizing physical attacks).
  - rchaud 5y ago
    Fair point. The only places where you can pay a lower price when using cash is at small convenience stores.
berdario 5y ago
> To begin with there are several layers of protection built in at acquirer, issuer, network and so on. Almost at each step there's an option to reverse the payment (or issue a compensating transaction) and finally the chargeback and legal recourse I'm vaguely aware that there are several checks at the different layers... but I'm puzzled, are there really options to reverse payments at all those layers? I'm asking, because I've seen multiple times some surprising transactions/unapproved transaction/forgot to cancel a recurring payment... and, each and every time... the e-money institution/bank/credit card provider, was unable to do anything, until the transaction actually posted. i.e. while the transaction was still shown as "pending", I couldn't do anything (besides contacting the seller, which obviously wouldn't do anything). Each and every time (when I couldn't eventually get a refund from the seller), I had to wait for the transaction to be posted to be able to file a chargeback
BelenusMordred 5y ago
> I am yet to work with a payment method that does not support reversal Strange, because from your comments you are based in India and there's simply no way to reverse a bank transfer there or in my own country, can you confirm this? What I've read over the years suggests the complete opposite of what you've said. A brief internet search brings up: > Adhil Shetty, CEO & co-founder, Bankbazaar.com, says, "The most important thing to understand is that if a transaction has been made, the bank cannot reverse it from its end without approval from the beneficiary. Bank can only act as a facilitator." https://www.businesstoday.in/personal-finance/banking/story/what-if-you-transfer-money-to-a-wrong-bank-account-62739-2016-05-12 https://www.businesstoday.in/personal-finance/banking/story/... > According to the Reserve bank of India, it is the senders responsibility to link and transfer money correctly by cross checking the account number and name of the beneficiary. Banks will not be held responsible. https://www.allonmoney.com/banking/money-transferred-to-wrong-account/ https://www.allonmoney.com/banking/money-transferred-to-wron...
- vishnugupta 5y ago
  Semantically you are right, however there's more to it. Bank transfer can be invoked within the context of a business transaction (e.g., buying on Amazon) or as a standalone payment with no context attached to it. In the first case, the money goes through many intermediaries such as payment gateway, merchant, acquirer, etc. In this instance, a customer can dispute a payment at different levels beginning with the merchant (or marketplace), their issuer, and finally file a case in the consumer court. 90% of the disputes get settled by the merchant/marketplace. Issuers typically side with the consumer because their primary customers are consumers. Consumer courts take time to settle a dispute, but they do work. It's possible for fly-by-night sellers to con a bunch of customers but it's rare. Because payment gateways and acquirers have gotten their act together in recent years and they do stricter KYB checks (Know Your Business). The bulk of the theft happens through person-to-person bank transfer, i.e., devoid of any business context. Here, the fraudsters con a gullible person to reveal bank credentials and also second-factor auth. Social engineering attacks are also common. But the thing is you always know the destination bank account. So you can track the fraudster as the destination bank would have done a KYC. The key point to note here is that the money can always be physically traced. And there are laws that let victim claw back that money if they can provide sufficient evidence of fraud.
kragen 5y ago
Payment reversal is an open invitation to criminals to steal from sellers. A friend of mine had his laptop stolen via payment reversal. Listed it on Craigslist for sale, a woman paid by PayPal and then came by to pick it up, and after she left she reversed the payment. PayPal automatically took her side because he didn't have a shipping tracking number. Cashier's-check scams are another classic form of this crime: https://www.vox.com/the-goods/2019/8/19/20808526/cashiers-checks-online-scams https://www.vox.com/the-goods/2019/8/19/20808526/cashiers-ch... https://www.consumer.ftc.gov/articles/how-spot-avoid-and-report-fake-check-scams https://www.consumer.ftc.gov/articles/how-spot-avoid-and-rep... Obviously any payment method that is a layer over credit cards and US bank transactions is going to want to support reversal; otherwise, in cases like these, the payment processor gets left holding the bag. It's not "the result of decades of learnings and trial and error." It's the result of banking regulations which impose huge risks on anyone who receives money through the banking and credit card system, in order to avoid imposing risks on people who send money. In many cases, those risks are not inherent to the transaction being conducted; they are introduced by outdated banking business practices that rely on detecting rare frauds after the fact and clearing transactions over the course of weeks or months. Instead of removing the risks, current banking regulations force them on anyone who receives a payment, so the banks don't have to fix them. Cryptocurrencies just remove those risks instead of externalizing them. And that's why so many payment methods support reversal.
- Nursie 5y ago
  Payment non-reversibility is an open invitation to sellers scamming, something which has been recorded for thousands of years. You’d have to be historically illiterate to want to throw this stuff away. I’m sorry your friend got scammed, but there’s a host of damn good reasons we put the risk on the seller. This is not a set of outdated practices resulting in ‘risk’ to sellers, it’s deliberate consumer protection.
  - kragen 5y ago
    There are indeed cases where transactions involve unavoidable risks, and in some of those cases it is best to force the seller to assume those risks rather than the buyer. (I'm not sure why you've put "risk" in scare quotes; as my examples show, these are real risks.) In other cases, like when I pay the rent for my apartment, or when I sold a used car to a body shop, it would be better for the buyer to assume those risks. But there are additional, unnecessary risks created by the banking system, and for many transactions (like when the thief stole my friend's laptop, or transactions that result in identity fraud) those risks are the vast majority of the total risk. In those cases, cryptocurrency solves the problem; it doesn't just shift the risk back to the buyer.
anm89 5y ago
Cash does not have charge backs

ramesh31 5y ago

>Are there plans to build equivalent features on Blockchain for crypto currencies? The entire plan of crypto is to not ever allow that. That's the big innovation.

_Nat_ 5y ago
> That's the big innovation. You're right that a lot of folks don't want features like that, though I just had to point out that this isn't an "innovation" by any wild stretch of the imagination, but rather simply a policy in some implementations. It's mutable, too, for both banks and crypto: either could allow/disallow such a policy if those involved cared to make it work that way.
- saba2008 5y ago
  >simply a policy in some implementations Reversals would mean that there is some authority that can declare arbitrary transaction to be valid or not, and cryptocurrency is exercise in creation of payment system without such trusted party. So no, would not call it simply a policy.
  - _Nat_ 5y ago
    It's definitely a policy, in that it's a design-decision that could be changed to make it operate differently. For example, if a good majority of a crypto-currency's miners elected to fork to a new policy, then it'd just happen. And cryptocurrency isn't really about lacking a trusted-party so much as decentralizing the trusted-party. Which might sound pedantic, but it's an important distinction: there can be an authority that makes decisions, just it'd be decentralized. Future crypto-systems, e.g. probably a next generation that'll replace early systems like Bitcoin, would probably take a smart-contract approach. For example, a payment could be reversed under conditions encoded in a smart-contract. A well-developed system would likely end up including a system of checks-and-balances, appeals, manners of collecting evidence, etc., where trust is decentralized. For example, most folks would generally agree that a mature, well-developed system should allow someone to recover funds extracted from them under threat-of-violence if everyone agrees that that's what happened. That current systems are too limited to make such an obviously-desirable thing happen is an obvious non-ideality. Once someone makes a good system that fixes such problems, in a generally agreeable way that people can trust, it'll likely become a preferred system; it and its clones, etc., would displace older systems, and this whole no-reversible-transactions thing would become a minor footnote in early history.
    - saba2008 5y ago
      >isn't really about lacking a trusted-party It's also about minimizing amount of trust to that party. Only thing bitcoin miners are trusted, is determination of correct chronological order of transactions. >smart-contract approach Yes, and smart contract will just determine whenever transaction was made under threat of violence! >end up including a system of checks-and-balances, appeals, manners of collecting evidence So regular banking, under other name. Also 'collecting evidence' is pretty much incompatible with anonymity, which is cryptocurrency distinguishing feature. >trust is decentralized How is that even supposed to work? Do you expect that every chargeback will be investigated by every mining pool? Or they will have some authority to do it (again, no difference with regular banking) >most folks Most folks are ok with current banking system. Cryptocurrency is a niche product, having completely different trade-offs.

wyldfire 5y ago

> Are there plans to build equivalent features on Blockchain for crypto currencies? No, transactions are irreversible by design. If you want this, what you need is an escrow service. Escrow services can conduct transactions in bitcoin or other cryptocoins. I don't know of one, but I believe that they may exist.

gruez 5y ago

>I am yet to work with a payment method that does not support reversal (except for physical cash). As a last resort victims can file chargeback with their issuers or police. What about the stories of companies being scammed via wire transfer?

pc86 5y ago
This isn't a scam, it's robbery/theft, which is an important distinction. If you're robbed at an ATM the bank will make you whole. If someone lies to you and asks for money, you go to an ATM and give it to them, the bank isn't going to do anything about it.
- dk775 5y ago
  You would consider this robbery/theft? Had an in person sale with money sent over cashapp and they charged me 250 dollars more, as the item received was half of what I expected. This was automotive fluids, not drugs lol. I had stupidly sent the money before I checked. Cashap didn’t do anything and figured I messed up so why go to bank. Hits me a little different now…
0xEFF 5y ago
The only time average people wire money is when they close on a mortgage.
- yebyen 5y ago
  And for someone that has never done it before, it's absolutely terrifying – probably the most money you've ever spent in your life in a single transaction, with zero visibility into whether the transaction has worked, and fraud warnings in big red letters to let you know that if you're going to get robbed or scammed, it's probably right here that it will happen. And be prepared to wait 24 - 72 hours for final confirmation!
wmf 5y ago
Wire transfers can be reversed in some cases but it's not as simple as filing a chargeback; AFAIK it requires cooperation between law enforcement and the recipient bank.

jcpham2 5y ago

reversible payments equals double spending, which is fraud, which is your payments industry. read the white paper start over. do not collect $200

amarant 5y ago
Because crypto-weebs would never ever make a mistake, ever. So clearly this is better. Sigh
- jcpham2 5y ago
  not my protocol, nor am I OP who lacks technical understanding of question asked I guess when I don't answer question nicely enough for the anti-crypto cunts I get downvoted for it, as if HN opinions even matter any more
- dang 5y ago
  Please do not respond to a bad comment by making thread even worse. That helps nothing and is against the site guidelines in its own right. "Don't feed egregious comments by replying; flag them instead." a.k.a. please don't feed the trolls https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
  - amarant 5y ago
    You might be right, I can never tell the serious people from the trolls when it comes to crypto. And often times the serious ones are even otherwise intelligent. Crypto is like religion in that sense: sometimes the most intelligent people believe the most egregious things! My apologies if I failed to spot what should've been an obvious troll..
dang 5y ago
Breaking the site guidelines like this will get you banned on HN. If you wouldn't mind reviewing https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html and sticking to the rules when posting here, we'd be grateful. You've unfortunately done it repeatedly before (e.g. https://news.ycombinator.com/item?id=27207170 https://news.ycombinator.com/item?id=27207170) - this is definitely not cool, so please fix.

Cthulhu_ 5y ago

This article reads like an advert for this service (casa) pushing for similar bank guarantees / insurance as traditional banks, so er. Yeah basically the same thing. I mean if someone steals your cash money there's no way to get it back either.

hn_throwaway_99 5y ago

> Are there plans to build equivalent features on Blockchain for crypto currencies? Basically every crypto enthusiast out there touts the non-reversibility of crypto transactions as its primary feature, not a bug, and that is why I see crypto as generally useless for your average person.

swiley 5y ago
It is, bitcoin is cash on the internet. If you want reversible transactions and credit then use a credit card, I'm pretty sure there are credit cards for crypto now and if there aren't there probably will be soon.
pelario 5y ago
Not a fan of crypto, but your argument applies to cash, wish is still widely used (not only by shady people ;) )
- wombatpm 5y ago
  I don’t keep me entire net worth in cash. ATMs have limits, and banks typically require in person presence and reporting when dealing with large amounts of cash. Crypto not so much.
- linspace 5y ago
  I really don't know anything about the subject but I think stolen cash is much more hard to conceal and to move. It can be marked also and tracked (or so they say in the movies). You need to justify its possession. You cannot go to the airport with an arbitrary amount of money.
  - jhauris 5y ago
    > You cannot go to the airport with an arbitrary amount of money. This is actually a major problem in the U.S. where the fourth amendment is supposed to protect against unreasonable seizure. It is not illegal to carry cash, but federal and local law enforcement agencies will by policy seize cash without charging anyone with a crime. The victim needs to sue to get their money back, and then the agencies use tax-payer dollars to fight it. This is a clear violation of the 4th amendment, but is absolutely rampant. If we don't fix these problems with cash, you can bet they'll come for your crypto when it becomes popular enough.

drcode 5y ago

Ethereum has had a couple of reversible payment systems built over the years, but nobody used them. Non-reversible, immediate, guaranteed transactions are just more convenient outside of a few edge cases

ubercore 5y ago
As kind of an outsider to a lot of things payment and crypto, just a normal consumer, I feel like this is a scenario where you don't know you're an edge case until it's too late.
pc86 5y ago
"A few edge cases" including the fact that a sizeable chunk of the population will go through extremely convoluted means to steal from you, especially in the case of non-reversible, immediate, and guaranteed transactions?
user-the-name 5y ago
Similarly, outside of a few edge cases, it is a lot easier and cheaper to build a house with no fire protection whatsoever.
- saalweachter 5y ago
  Brakes just make the car go slower or even stop, but the entire purpose of a car is to go and go fast.

theli0nheart 5y ago

Paying by cash is irreversible. That’s how payments were until credit cards and the Internet came along. One of the big innovations of cryptocurrency is allowing for electronic, cash-like payments. To solution to coercing a “reversal” of a transaction is use the legal system.

Nursie 5y ago
One of the big innovations of non-crypto payment methods over cash was the ability to reverse. > To solution to coercing a “reversal” of a transaction is use the legal system. Or, just maybe, we could have a system which doesn't need to involve the legal system every time, and protects consumers anyway. Which we have.
- deleted 5y ago
  [deleted]
- theli0nheart 5y ago
  > Or, just maybe, we could have a system which doesn't need to involve the legal system every time, and protects consumers anyway. You omitted the part where this solution requires a surcharge of ~3% on every single transaction we make with our credit cards. In a civilized society, this is how transactions work: You research the merchant and judge whether they are trustworthy. You decide they are, and purchase an item from them. If you have a problem with the item, you request a refund. They ask for the product back, and then they send you the refund. Nothing in the above paragraph requires a credit card processor to enable a reversal of funds. If they refuse to provide a refund, that is their choice, but relying upon a central god-like money authority to judge whether they made the "correct" one is bonkers. That's under jurisdiction of the law.
  - Nursie 5y ago
    That’s not an issue in my country where fees are limited. In your civilised society I will never, ever use a new merchant or a small merchant. One vendor that promises easy refunds would be the only place I would ever shop. Small vendors and new vendors can go hang. Hell, it might just kill internet shopping all together. In your civilised society, small business is f*cked. In your civilised society a person who has been ripped off by a merchant who refuses to deal with them or just plain disappears, has to spend time and more money dragging them through the courts, if they can even find them. Your ‘civilised’ society is carte blanche for unscrupulous merchants to rip people off, something which humanity has been dealing with since the dawn of history. We have these systems in place for a reason, and it’s to stop uncivilised merchants from doing what they’ve been doing as long as merchants have existed. You don’t have to take credit cards, by the way, but don’t expect my business if you don’t.

chrisseaton 5y ago

> I am yet to work with a payment method that does not support reversal Is CHAPS reversible? I don’t think it is. Or is it just not exposed as an option to institutions?

jonahbenton 5y ago
Most of these systems are not actually reversible at the protocol level. They sometimes offer cancellation at stages prior to settlement. When needed, transactions are most often "reversed" at the governance level.
- heavenlyblue 5y ago
  Bitcoin is reversible on the same level then.
  - rjmunro 5y ago
    If someone dies with their bitcoin password locked in their head, you can't get the account passed to whoever is named on the will, the coins are locked forever. Maybe a smart contract could help here. If there are no transactions on a wallet for more than some time period, allow the wallet to be unlocked or transferred to a trusted party.

Andrew_nenakhov 5y ago

As a person living in an authoritarian state, the inability of the government or other authority to reverse a payment looks like a very attractive feature to me. Yes, it does have downsides. They just don't look as troublesome as being completely cut off all financial services with a simple stroke of a pen - which was experienced by many members of political opposition in my country. "... but but Drugs! Criminals!" is what common people say at this point, to which I answer that drugs and crime flourished long before Bitcoin came to exist.

AdmiralAsshat 5y ago
See: https://en.wikipedia.org/wiki/Four_Horsemen_of_the_Infocalypse https://en.wikipedia.org/wiki/Four_Horsemen_of_the_Infocalyp...
jayd16 5y ago
Is the public nature of transaction worrisome to you? Seems like that might also be a political issue.
prox 5y ago
This is really the heart of the matter. On hand , yay, great we can subvert nasty states using cryptocoin, but also could undermine legitimate democracies. Swords cuts both ways. No one can deny the wave of ransomware and cryptocoin are not related. How do we balance it so it can provide a net positive for humanity?
- Andrew_nenakhov 5y ago
  Yeah, nobody ever asked for ransom before cryptocoins. /s Legitimate democracy can't be undermined by an international currency not controlled be the government. In fact, it can be reinforced by it. This issue is very similar to free speech: the good it does by making the government unable to silence political opponents far outweights the harm done by extremists and lunatics of all sorts.
  - user-the-name 5y ago

jpmattia 5y ago

> I am yet to work with a payment method that does not support reversal (except for physical cash). I'm not sure I get your objection: Physical cash is exactly the use case for bitcoin. There will be financial services and other layers built on top of bitcoin, just as it is done for the dollar, and we are seeing the nascent industry now. (Whoever provides insured services first is going to make a mint.)

raesene9 5y ago
I thought Bitcoin was more a store of value (e.g. analogous to gold) than a currency similar to physical cash? If so the problem becomes, is your personal security up to defending attackers who want to take your pile of digital gold.
- jpmattia 5y ago
  > I thought Bitcoin was more a store of value (e.g. analogous to gold) than a currency similar to physical cash? Physical cash is money, and serves the functions of money (see eg https://en.wikipedia.org/wiki/Money#Functions https://en.wikipedia.org/wiki/Money#Functions) Bitcoin does the same. In the nascent crypto world, different areas are using this new money in different ways: The US currently tends to store of value. Other areas (Venezuela, El Salvador) are tending toward medium of exchange. In any case: OP's reversibility-of-transactions is a financial services function, not a "money" function.

joseluis 5y ago

yes, it's being worked on, but it's only apparent if you know where to look, that means in business oriented blockchains. This could be a good starting point: https://coingeek.com/stefan-matthews-on-hashing-it-out-episode-3-blockchain-is-the-perfect-technology-for-regulatory-compliance-video/ https://coingeek.com/stefan-matthews-on-hashing-it-out-episo...

cortesoft 5y ago

Yeah, this is the part of the cryptocurrency I don’t understand… i feel most people are way more likely to need to have a charge reversed because of fraud than to have some payment to them reversed in fraud…why would we want to make the more likely situation impossible to protect against the more rare situation?

morpheos137 5y ago
Well obviously core users of Bitcoin like ransomware artists don't want their gainz reversed. Most people who really use (as opposed to hodl) bitcoin outside of speculation are criminals.

devit 5y ago

Transactions have to be irreversible so that law enforcement is impossible, which is the main selling point of cryptocurrencies. Of course that's a downside if you are the one who would like law enforcement to happen (either because you are the victim of a theft or you want to enforce on others). Also fraud can be done with reversible transactions as well, in particular the reversal can be fraudulent; in general, reversible transactions are only really effective if the conveyance of whatever was paid for is also reversible.

linspace 5y ago
I thought that the selling point was avoiding centralization. I suppose some measures could be implemented to avoid robbery.
Nursie 5y ago
Reversible transactions are effective at building trust in situations where you don’t trust the merchant. If I can reverse a transaction if I get ripped off, I might consider using a smaller or newer vendor. If I can’t then no chance, I’m sticking to the one I trust, even if they don’t have what I want. Reversible payment methods are a huge boon to merchants, whether they realise it or not.

vbuterin 5y ago

The closest thing to those concepts in crypto would be multisig wallets, including more advanced ones that enforce a "daylimit" where a single key can withdraw a small amount but larger amounts require confirmations from multiple keys or a delay during which another key can cancel the transfer. See also this piece by me on social recovery (a related but not quite the same concept): https://vitalik.ca/general/2021/01/11/recovery.html https://vitalik.ca/general/2021/01/11/recovery.html But this is all not quite the same as reversal and makes different tradeoffs.

m3kw9 5y ago

Sort of reminds me of killing flies with a tank gun, they have done hard forks of the block chain for huge sums before.

Tenoke 5y ago

My bank also in theory supports reversing transactions but last two times I've asked them to they didn't do it anyway. Anyway, there's no issue with building and using a service to handle that for you both on top of the currencies and as a smart contract on the blockchain itself. Most current crypto users just don't seem likely to use it as they prefer the control. This might change as the audience changes.

rchaud 5y ago

> Or do their users have to go through the same painful failures? This might actually be the first time for people to learn these lessons. They've been free-riding on the protections that banking regulations provide for all of their lives.

geofft 5y ago
To be fair, they haven't been free-riding. Credit cards force prices up by about 3% for a reason, and checking accounts don't give you market yields for a reason. But yes, for me personally, I much prefer deterministically losing 3% to risking 100% (and incentivizing physical attacks).
- rchaud 5y ago
  Fair point. The only places where you can pay a lower price when using cash is at small convenience stores.

berdario 5y ago

> To begin with there are several layers of protection built in at acquirer, issuer, network and so on. Almost at each step there's an option to reverse the payment (or issue a compensating transaction) and finally the chargeback and legal recourse I'm vaguely aware that there are several checks at the different layers... but I'm puzzled, are there really options to reverse payments at all those layers? I'm asking, because I've seen multiple times some surprising transactions/unapproved transaction/forgot to cancel a recurring payment... and, each and every time... the e-money institution/bank/credit card provider, was unable to do anything, until the transaction actually posted. i.e. while the transaction was still shown as "pending", I couldn't do anything (besides contacting the seller, which obviously wouldn't do anything). Each and every time (when I couldn't eventually get a refund from the seller), I had to wait for the transaction to be posted to be able to file a chargeback

BelenusMordred 5y ago

> I am yet to work with a payment method that does not support reversal Strange, because from your comments you are based in India and there's simply no way to reverse a bank transfer there or in my own country, can you confirm this? What I've read over the years suggests the complete opposite of what you've said. A brief internet search brings up: > Adhil Shetty, CEO & co-founder, Bankbazaar.com, says, "The most important thing to understand is that if a transaction has been made, the bank cannot reverse it from its end without approval from the beneficiary. Bank can only act as a facilitator." https://www.businesstoday.in/personal-finance/banking/story/what-if-you-transfer-money-to-a-wrong-bank-account-62739-2016-05-12 https://www.businesstoday.in/personal-finance/banking/story/... > According to the Reserve bank of India, it is the senders responsibility to link and transfer money correctly by cross checking the account number and name of the beneficiary. Banks will not be held responsible. https://www.allonmoney.com/banking/money-transferred-to-wrong-account/ https://www.allonmoney.com/banking/money-transferred-to-wron...

vishnugupta 5y ago
Semantically you are right, however there's more to it. Bank transfer can be invoked within the context of a business transaction (e.g., buying on Amazon) or as a standalone payment with no context attached to it. In the first case, the money goes through many intermediaries such as payment gateway, merchant, acquirer, etc. In this instance, a customer can dispute a payment at different levels beginning with the merchant (or marketplace), their issuer, and finally file a case in the consumer court. 90% of the disputes get settled by the merchant/marketplace. Issuers typically side with the consumer because their primary customers are consumers. Consumer courts take time to settle a dispute, but they do work. It's possible for fly-by-night sellers to con a bunch of customers but it's rare. Because payment gateways and acquirers have gotten their act together in recent years and they do stricter KYB checks (Know Your Business). The bulk of the theft happens through person-to-person bank transfer, i.e., devoid of any business context. Here, the fraudsters con a gullible person to reveal bank credentials and also second-factor auth. Social engineering attacks are also common. But the thing is you always know the destination bank account. So you can track the fraudster as the destination bank would have done a KYC. The key point to note here is that the money can always be physically traced. And there are laws that let victim claw back that money if they can provide sufficient evidence of fraud.

kragen 5y ago

Payment reversal is an open invitation to criminals to steal from sellers. A friend of mine had his laptop stolen via payment reversal. Listed it on Craigslist for sale, a woman paid by PayPal and then came by to pick it up, and after she left she reversed the payment. PayPal automatically took her side because he didn't have a shipping tracking number. Cashier's-check scams are another classic form of this crime: https://www.vox.com/the-goods/2019/8/19/20808526/cashiers-checks-online-scams https://www.vox.com/the-goods/2019/8/19/20808526/cashiers-ch... https://www.consumer.ftc.gov/articles/how-spot-avoid-and-report-fake-check-scams https://www.consumer.ftc.gov/articles/how-spot-avoid-and-rep... Obviously any payment method that is a layer over credit cards and US bank transactions is going to want to support reversal; otherwise, in cases like these, the payment processor gets left holding the bag. It's not "the result of decades of learnings and trial and error." It's the result of banking regulations which impose huge risks on anyone who receives money through the banking and credit card system, in order to avoid imposing risks on people who send money. In many cases, those risks are not inherent to the transaction being conducted; they are introduced by outdated banking business practices that rely on detecting rare frauds after the fact and clearing transactions over the course of weeks or months. Instead of removing the risks, current banking regulations force them on anyone who receives a payment, so the banks don't have to fix them. Cryptocurrencies just remove those risks instead of externalizing them. And that's why so many payment methods support reversal.

Nursie 5y ago
Payment non-reversibility is an open invitation to sellers scamming, something which has been recorded for thousands of years. You’d have to be historically illiterate to want to throw this stuff away. I’m sorry your friend got scammed, but there’s a host of damn good reasons we put the risk on the seller. This is not a set of outdated practices resulting in ‘risk’ to sellers, it’s deliberate consumer protection.
- kragen 5y ago
  There are indeed cases where transactions involve unavoidable risks, and in some of those cases it is best to force the seller to assume those risks rather than the buyer. (I'm not sure why you've put "risk" in scare quotes; as my examples show, these are real risks.) In other cases, like when I pay the rent for my apartment, or when I sold a used car to a body shop, it would be better for the buyer to assume those risks. But there are additional, unnecessary risks created by the banking system, and for many transactions (like when the thief stole my friend's laptop, or transactions that result in identity fraud) those risks are the vast majority of the total risk. In those cases, cryptocurrency solves the problem; it doesn't just shift the risk back to the buyer.

anm89 5y ago

Cash does not have charge backs