>But until Bitcoin there was no real way to do cash-like transactions electronically.
There was Venmo and all the other small cash transfer apps. BTC is decentralized but that's of questionable worth to an end user.
The entire point is Bitcoin is like "cash for the Internet" in that once I hand someone $20 in BTC it's just like handing them $20 in physical cash. I have no third party either telling me I can't make that transaction, or with the ability to reverse the transaction after the fact. This is a feature, not a bug.
Anything to disintermediate financial institutions that like to apply political and corporate policy on who I can conduct business with is a good thing in my opinion. This means my options when the third party frauds me are the traditional options employed by folks dealing with cash transactions since money was invented. I can sue them in court, forget about it, or round up some friends with lead pipes.
I think many folks completely miss the point. Cash is useful. Cashless society is about the worst dystopia I can imagine - with unaccountable third parties and government able to track your every spending move, while simultaneously applying their political or legal policy to every transaction. Bitcoin's first step into introducing cash-like digital currency is the innovation, and it clearly is needed. Certainly not perfect (privacy could be far better, security is a real problem, etc.) - but it's far better than anything that had previously come along.
Comparing venmo to bitcoin is simply not a comparison - they solve entirely different problems. Venmo lets you send money from your bank account to another bank account with all those political and legal restrictions applied to your transaction. Bitcoin effectively lets you send cash to anyone you want, in any amount, and no one can stop that transaction from happening because they didn't like the person you are sending it to or what you were buying.
I do agree most users do not have the same concerns so the use case is far more limited than the hype. I do also still see a lot of value in "digital cash" as a whole, but I never really bought the whole store of value argument and the raft of grifters it attracted.
Yep. Gotta agree with Jayd16 here, if you still need law enforcement, (ie - government), then bitcoin is not useful for operating without trust. The breathless hype about bitcoin was not just the technology level "distributed ledger" thing, but also the idea that you could do things independent of the system. If you still need the system to make it all work, then it definitely fails on the latter hype point.
Bitcoin is independent of the "system" but that doesn't mean you don't still need some system. You're just not locked in to any particular system. Using bitcoin doesn't automatically make you an anarchist.
Is this something that actually happens? Police hardly help with with recovering stolen physical goods; I highly doubt they'd even consider helping if your crypto gets hacked
Then you are effectively trusting a third party to make it right when you have been wronged. Isn't this contradictory to the promise of blockchains: That trusting a third party is not required??
Taking this further, you are saying that the data on a blockchain cannot be trusted because the transactions might be reversed due to outside action. Honest question: How does this fit into the concept of a blockchain?
Your comparing cash to something electronic. No matter how you spin it Bitcoin is not physical. It’s more akin to cash in a bank account. Cash is in my hand, Bitcoin is virtual.
>The $0 Liability Guarantee covers fraudulent transactions made by others using your Bank of America consumer credit cards and consumer and small business debit and ATM cards. To be covered, report transactions made by others promptly, and don't share personal or account information with anyone. Access to funds next business day in most cases, pending resolution of claim. Consult client and account agreements for full details.[1]
[1]https://www.bankofamerica.com/privacy/faq/data-compromise-fa...
Losing $60,000 in Bitcoin is like losing $60,000 in cash. It’s not exactly a surprise that it can happen, and it’s expected that there will be no real recourse.
I think the trouble is that people still aren’t really thinking of it properly. If this story happened with cash, the first question everybody would be asking would probably be, “Why did you have $60,000 in cash sitting around? What did you think was going to happen?”
Like cash, most people shouldn’t be holding large amounts of Bitcoin themselves. If they want large Bitcoin holdings for whatever reason, they should be held with a trustworthy entity that can properly secure them, like a bank. If they do insist on holding large amounts of Bitcoin directly, they need to understand that it’s like keeping a vault full of cash, and they need to work hard to keep it secure.
Cash is a fiat currency and reproducible infinitely by the controlling government. The point of gold (as a money medium) is that it self-regulates the amount in circulation by being a tangible material in finite supply with cost associated in seeking more. This model has significant benefits and drawbacks (and, it's probably worth noting, its drawbacks are what led to the fiat model most countries use today).
Neither do I.
Practical digital cash of the type you describe needs to have two properties in addition to preventing double spending-- a) quick transaction time (close to immediate) and b) extremely small fees. Otherwise having small amounts of the digital cash doesn't make any sense.
Worse, you've got prior art in Ecash that not only had those properties but also unlinkability. So it can be done, Bitcoin doesn't do it, and as a result the market for it is extremely small and out of touch with the hype around it.
No such entity exists.
Transaction wise, cash transactions happen both live and physically, meaning you have some means to make sure the counterparty honors their part of transaction. Electronic cash systems involve third party to coerce the counterparty or refund you. In Bitcoin world, apart from hopes and dreams and magical reputation, there is literally no way to stop the counterparty shoving you their Prodeum. Bitcoin removes the trusted third party of electronic cash, but fails to introduce physical measures of physical cash.
Bitcoin transactions are hardly even transactions, more like throwing money into numbered bin and hoping for the best. To be fair, the system has not gone down the drain once some form of market formed, so the hopes mostly did not backfire. The absence of full transactions in my opinion (I may be wrong, though) means Bitcoin IOUs cannot exist and with that whole financial products market, for better or worse.
Loss wise, cash is either in your posession or not and a lot of times can be recovered when lost. Stolen private keys can remain dormant for indefinite amount of time until they are actually used to move coins to a different address. With cash that one has in their immediate possession it would be immediately obvious if someone tries to take them away. If physical cash bills got sticky, you have taken an extra bill, dropped it on a counter and noticed your mistake, then you can still take back the extra bill. If you have transferred too much/many coins, then it's SFYL. Forgetting a wallet with physical cash somewhere can be SFYL, can still be recoverable if no one took possession of it. Losing access to private keys is permanent SFYL.
I'm assuming you're referring to threat and/or use of violence, but that's not a viable option if the counterparty is prepared. Are you really willing to get into a fist/knife/gun fight if you're trying to sell a Xbox and the other side doesn't want to pay up?
The point is that the threat model of Bitcoin is quite different from that of cash.
This is another example of how people don’t think of it properly. Sending Bitcoin to some stranger online is basically equivalent to mailing them cash (minus the chance of having the letter stolen). Most of us would understand that mailing cash to a stranger is probably a bad idea, but Bitcoin is used differently.
You say that like it's a bad thing. Bitcoin is something that has the advantage of physical cash (trust-less) and the advantage of electronic communications (you can't practically send cash to the other side of the world).
It also, of course, has the disadvantage of physical cash which is, once it's gone, it's gone. There is no way to reverse trust-less transactions now and there was none in the (pre-Bitcoin) past. Nothing has changed there and this is not what crypto solves. What crypto solves is trust-less transactions over the internet.
In your bank example, the bank likely took the financial hit. With bitcoin as an underlying tech, there's some reduction of risk (with a whole bunch of asterisks).
Bitcoin is more akin to cash in hand than cash in a bank account, the title of the white paper is a 'A Peer-to-Peer Electronic Cash System'.
It behaves like cash.
Of course, it is. The government could force everyone to send Bitcoins to a special account which is then distributed to victims (i.e. a tax). That would actually be better than what we have now. By printing more cash, people with cash are punished while actually rich people (who own stock, real estate, factories, jets etc.) are not.
In places where there have been cryptocurrency thefts that have been prosecuted, they have been primarily pursued as cases of theft -- the US statutory definitions of theft usually only use the monetary value (the USD equivalent) as the determiner of the severity.
While such a policy of "do not pursue bitcoin theft" would theoretically be possible either as an explicit policy or an informal, I thing it would be unlikely to survive judicial scrutiny; it would be like insisting that car thefts only be investigated and prosecuted for American-made cars.
This is not dissimilar to how cash works -- if someone takes my cash, by fraud, by theft, or in legitimate exchange for goods or services, that's it. They can now spend it however they want. Cash itself is a trustless system in the same sense. Where there is trust it's largely a matter of preventing forgery; which is not dissimilar to the idea of preventing double-spends.
But until Bitcoin there was no real way to do cash-like transactions electronically.
In other words, the utility of Bitcoin is well-established; humans have been using cash for a very long time. The implementation is novel. I don't speak here to the general "blockchain" concept, which has become so nebulous that I don't feel it's worth making general statements about.