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> A legitimate trade always occurs between willing partners Charge back fraud (also called friendly fraud) is a big problem in commerce, where the buyer will b

• mrtksn 5y ago
  But that is an illegitimate trade and cuts BOTH WAYS. When the buyer is fraudulent the merchant swallows the cost AND when the merchant is fraudulent the buyer swallows the cost. That's actually why credit cards come with protection against fraudulent merchants and you need a good enough credit score to actually get a credit card. On top of that, payment processors run fraud detection systems that block suspicious actions. Irreversibility turns the trade into a competition over who is the better fraud. The only thing that the crypto guarantees is that the winner keeps the prize.
  • xur17 5y ago
    > Irreversibility turns the trade into a competition over who is the better fraud. The only thing that the crypto guarantees is that the winner keeps the prize. I think it's more complicated than that. It moves the fraud risk to one specific spot (the consumer) which VASTLY simplifies the checkout process + the costs associated with online purchasing. Right now online payments are a giant mess - every single merchant has to implement anti-"fraud" tools to try and ascertain the identity of the consumer and determine if it matches the owner of the card. As a consumer, I would happily take this trade for lower prices.