> Could you please expand on how does the Ethereum blockchain get to know whether the goods arrived if the buyer and seller are saying conflicting things and no third parties are involved?

It's possible to have some mutually assured destruction here, e.g. the contract is for $100 so the buyer puts in $150 and the seller puts in $100. Then when the buyer releases the money, they get $50 of their money back and the seller gets $200 ($100 from the buyer and their original $100). If the buyer doesn't release the money, nobody gets anything.

It gives the buyer a way to punish the seller for non-delivery, but without receiving any personal benefit (and in fact at a personal cost) for using it.

If the only recourse for a defrauded buyer is either to simply eat the loss or lose even more money, that's not what I'd consider an acceptable solution that's competitive with other, non-crypto means of payment. It's a solution that does provide some disincentive against fraud, but it's significantly worse for most consumers than the current status quo.

> If the only recourse for a defrauded buyer is either to simply eat the loss or lose even more money, that's not what I'd consider an acceptable solution that's competitive with other, non-crypto means of payment.

In the existing payment market you have a seller with no stake and have to correct for it by drafting the payment processor to post a stake instead. Then if the seller doesn't send the product (or sometimes even if they do), the buyer makes a claim with the payment processor and the payment processor is stuck refunding it because the alternative is having a larger cost imposed on them by the government. Then they try to mitigate the loss by not paying the seller, if they can.

This is just unnecessary indirection when the seller posts a stake instead. If the seller has $200 on the line over a $100 value item, they're going to deliver it because the alternative is a $100 net loss. It's the same reason the payment processor refunds your money -- because the alternative is worse for them.

The buyer doesn't actually lose the extra $50, they just sit on it until the seller makes good, which happens eventually because the seller's alternative is worse. The end result of MAD isn't that everybody gets nuked, it's that nobody does.

there's an endless supply of replies to comments like yours that go like "it will never be possible to fix every problem so the safest move is no move", and I don't wish to be that kind of commenter, i.e. I think it is good to at least try and propose mechanisms -even flawed ones- so that at least the discussion of the problems continue and hopefully the mechanisms can be improved.

it is in this mindset that I am asking if we can adress the following issue: suppose the government or its postal system selectively withholds the goods payed for through cryptographic protocols, then buyer and seller lose.

again, I'm not trying to be destructive, just wondering out loud if we can generalize the kind of protocol you describe to include the transporter as an attacker in the attack model.

I think we could split up in 2 cases: transporters that are paid on the same cryptographic protocol/platform, and transporters that are paid outside. I believe it will be easier to solve the problem by restricting to transporters who get paid by the same contract/platform, since we could have the transporter deposit an insurance of same or higher value as the good to be transported, and upon arrival his pre-agreed transport cost and deposit are released?

Obviously the traditional postal system can not be forced to be paid through this platform, so this hole in the market would effectively create demand for crypto postage and hence create jobs.

I would like to see a more rigorous breakdown of such a protocol, and a censor-ship free listing of issues remaining with the protocol, so that the discussion on improvement can continue.

Also it seems like the first transporter does not need to be the same person as the last transporter, i.e. intermediary packet handoff could also be handled by the protocol such that the first transporter gets paid back his deposit after doing "his part" of the packet journey...

There are two parts to that. One is insurance -- 8% of packages don't make it to the destination and it would be preferable to pay an 8% premium than to lose 100% of the delivery 8% of the time. There is obviously an insurance market for this.

The second part is that it's often more efficient for the insurance provider to be the delivery provider, because then they have the right incentives to actually deliver your package. Then it's their problem whether they farm out the delivery to the local postal service and take the risk of having to pay claims, or operate some kind of underground railroad themselves in authoritarian countries and pay a little higher cost to reduce the losses they have to eat.

It seems that you're describing a solution to the problem of delivery failure. However, the larger problem where consumers need the ability to revoke deals is not failure of delivery as such, but failure to deliver the right goods, possibly maliciously. And vice versa, the possibility by consumers to exploit the system to maliciously refuse paying for goods.

Censorship resistance is an edge case that's nice to have for some people, fraud resistance is the mainstream need that's mandatory for most users. Current crypto approaches don't handle fraud resistance as well as the traditional payment systems, so censorship resistance is a moot point until/unless that gets solved.

I am making no claims about priority of problems, so I certainly welcome identification of other issues and proposals to improve them.

If we mentally subdivide all commercial activity between traditional/centralized/blind trust commercial activities and novel/decentralized/cryptographic trust commercial activities, then (even if it is not occuring yet) it can desirable for the supporters of decentralization to be able to assure themselves that the status quo can not undermine the economic value of the cryptographic trust community.

Even outside of cryptocurrencies we have debates about net neutrality, priority of packets etc... One could similarily wonder if current delivery services are able to say profit by investing in specific companies within a sector of products, and differentially prioritizing the delivery of their goods (or gentleness of delivery for fragile goods, or even non-delivery).

I don't believe in moot points, people can work on different issues, design solutions for them and then they can look at how to intersect/generalize their protocols so that it displays both or more desirable traits...

Okay, in that regard the assumption that "the government or its postal system selectively withholds the goods payed for through cryptographic protocols" seems questionable. Is this a real problem that we're seeing in some markets? As far as I'm aware it seems that in general delivery services are decoupled from the payment for goods; the delivery system, no matter if it's government postal system or private parcel delivery, does not know and can not know how (and if) the goods were paid for. They may require some declaration from the sender about the value for insurance and customs purposes, but that's different than the payment data.

Of course he can't.