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"But the trust that a bitcoin transaction is final isn't enough trust to make an exchange!" Correct. Who said it was? "How do we go about making that exchange

"But the trust that a bitcoin transaction is final isn't enough trust to make an exchange!" Correct. Who said it was? "How do we go about making that exchange happen if we assume that either party is self-interested, and not interested in actually completing the deal?" We don't make that exchange in that case. Or like you mentioned we both acknowledge that we don't trust each other and get a trusted third party involved who we both trust more that the each other. No payment method is immune to this. Notice though that regardless of how much trust that we have or don't have for each other we can both trust that if you do send me $5 of Bitcoin I will receive it. Provided I've taken the necessary steps the transaction will not be reversed. Also note that if I wish I can also be certain that no one can erase whatever I rightfully claim is mine from the ledger or transfer it to another address once I have received it. This cannot be said for any non crypto digital payment system currently. Bitcoin is a shared digital ledger hosted on a transaction network that is not controlled by a single trusted third party. The thing that keeps the ledger in check with reality is the correctness that it guarantees to those who are using the network to send and receive payments. If you say you are going to send me a 1700 sats to post a postcard to you and I deliver as promised but in reality you don't perform your part of the deal the ledger is still correct. You still owe me 1700 sats according the deal we made and I can confirm this by checking the ledger. The ledger itself does not know about the deal we made but we both know we made a deal and according to that deal you still owe me 1700 sats. Now with a traditional bank what happens if you claim you sent it and the bank says you didn't. How can I verify that the transaction took place? I can't. I have to trust what you or the bank tell me and I don't know who is telling the truth. Maybe the transaction got lost. Maybe you didn't send it. There is no way to discover the reality of the situation without having to make an uninformed choice about who I trust. At present Bitcoin is still clunky and has many issues both technical and non-technical to overcome. It is unknown whether these issues can or will be overcome. It has a far way to go if it is to realise the creators vision in a meaningful way by gaining mainstream adoption and use as "digital cash".

horsawlarway 5y ago
> The ledger itself does not know about the deal we made but we both know we made a deal and according to that deal you still owe me 1700 sats. Now with a traditional bank what happens if you claim you sent it and the bank says you didn't. How can I verify that the transaction took place? I can't. I have to trust what you or the bank tell me and I don't know who is telling the truth. Maybe the transaction got lost. Maybe you didn't send it. There is no way to discover the reality of the situation without having to make an uninformed choice about who I trust. Because the bank is acting as the (government approved) escrow service! Basically - The bank is arbitrating the dispute to resolve it (whether you like how the bank resolves that dispute is mostly irrelevant here). Let me ask you to follow up, given what you've said: > If you say you are going to send me a 1700 sats to post a postcard to you and I deliver as promised but in reality you don't perform your part of the deal the ledger is still correct. You still owe me 1700 sats according the deal we made and I can confirm this by checking the ledger. The ledger itself does not know about the deal we made but we both know we made a deal and according to that deal you still owe me 1700 sats. Now what? Fill me in on how we resolve this situation in your mind, once we've reached this point.
- CTDOCodebases 5y ago
  "Now what? Fill me in on how we resolve this situation in your mind, once we've reached this point." In the example you gave whether we chose to transact in cash, wire-transfer or bitcoin the result would be the same. I would have to rely on layers, civil or criminal courts, police, insurance companies, debt collectors, thugs or myself to physically retrieve the funds (or equivalent) if possible. If that was not possible some form of fair physical or financial punishment would be dealt to you or not. Honestly for that amount of Bitcoin I wouldn't be bothered and wouldn't follow it up. I would just never do business with you again and from that point forward never relinquish physical custody of goods for sale prior to receiving payment. "Because the bank is acting as the (government approved) escrow service! Basically - The bank is arbitrating the dispute to resolve it (whether you like how the bank resolves that dispute is mostly irrelevant here)." Trusted third parties will always be an issue where there is no trust between the buyer and seller. Sure multisig helps but the difference is Bitcoin gives us power to choose who we involve in the transaction. I and the other party I am transacting with combined are not forced to involve any one individual, company or nation state in the transaction if we do not wish them to be part of it. I think you are conflating trust in the Bitcoin network with trust in the humans transacting over the network. Regardless of the medium of exchange in order for transactions to occur we as humans need some level of trust in the party we are transacting with, trust in the network we are using to perform the transaction and trust that other humans are going to continue to value the medium being exchanged. Not everyone's level of trust in these aspects are going to be the same and people are going to value some aspects more than others. Personally I think if bitcoin doesn't overcome some of its hurdles soon it will probably just turn into a form of the existing banking network through legislation. It's already beginning to look like that with most individuals storing their Bitcoin on exchanges. Private wallets will be banned, transacting with non KYCd entities will become impossible using regulated custodians and any Bitcoin received from (or linked to) non KYCd addresses will be automatically seized by the government. At that point the supply can be artificially inflated. The number of Bitcoins in your account doesn't actually have to reflect the amount of bitcoin the custodian holds for you. The surveillance apparatus will become hyper focused on the Bitcoin network and everyone interacting with it. Like Ross Ulbricht you may be able to resist seizure of your Bitcoin but it will just result in a lengthy prison sentence. It may not stay like this forever though. So do you want a postcard? :)

horsawlarway 5y ago

> The ledger itself does not know about the deal we made but we both know we made a deal and according to that deal you still owe me 1700 sats. Now with a traditional bank what happens if you claim you sent it and the bank says you didn't. How can I verify that the transaction took place? I can't. I have to trust what you or the bank tell me and I don't know who is telling the truth. Maybe the transaction got lost. Maybe you didn't send it. There is no way to discover the reality of the situation without having to make an uninformed choice about who I trust. Because the bank is acting as the (government approved) escrow service! Basically - The bank is arbitrating the dispute to resolve it (whether you like how the bank resolves that dispute is mostly irrelevant here). Let me ask you to follow up, given what you've said: > If you say you are going to send me a 1700 sats to post a postcard to you and I deliver as promised but in reality you don't perform your part of the deal the ledger is still correct. You still owe me 1700 sats according the deal we made and I can confirm this by checking the ledger. The ledger itself does not know about the deal we made but we both know we made a deal and according to that deal you still owe me 1700 sats. Now what? Fill me in on how we resolve this situation in your mind, once we've reached this point.

CTDOCodebases 5y ago
"Now what? Fill me in on how we resolve this situation in your mind, once we've reached this point." In the example you gave whether we chose to transact in cash, wire-transfer or bitcoin the result would be the same. I would have to rely on layers, civil or criminal courts, police, insurance companies, debt collectors, thugs or myself to physically retrieve the funds (or equivalent) if possible. If that was not possible some form of fair physical or financial punishment would be dealt to you or not. Honestly for that amount of Bitcoin I wouldn't be bothered and wouldn't follow it up. I would just never do business with you again and from that point forward never relinquish physical custody of goods for sale prior to receiving payment. "Because the bank is acting as the (government approved) escrow service! Basically - The bank is arbitrating the dispute to resolve it (whether you like how the bank resolves that dispute is mostly irrelevant here)." Trusted third parties will always be an issue where there is no trust between the buyer and seller. Sure multisig helps but the difference is Bitcoin gives us power to choose who we involve in the transaction. I and the other party I am transacting with combined are not forced to involve any one individual, company or nation state in the transaction if we do not wish them to be part of it. I think you are conflating trust in the Bitcoin network with trust in the humans transacting over the network. Regardless of the medium of exchange in order for transactions to occur we as humans need some level of trust in the party we are transacting with, trust in the network we are using to perform the transaction and trust that other humans are going to continue to value the medium being exchanged. Not everyone's level of trust in these aspects are going to be the same and people are going to value some aspects more than others. Personally I think if bitcoin doesn't overcome some of its hurdles soon it will probably just turn into a form of the existing banking network through legislation. It's already beginning to look like that with most individuals storing their Bitcoin on exchanges. Private wallets will be banned, transacting with non KYCd entities will become impossible using regulated custodians and any Bitcoin received from (or linked to) non KYCd addresses will be automatically seized by the government. At that point the supply can be artificially inflated. The number of Bitcoins in your account doesn't actually have to reflect the amount of bitcoin the custodian holds for you. The surveillance apparatus will become hyper focused on the Bitcoin network and everyone interacting with it. Like Ross Ulbricht you may be able to resist seizure of your Bitcoin but it will just result in a lengthy prison sentence. It may not stay like this forever though. So do you want a postcard? :)