> In general the answer for consumer protection is to use any escrow service.

No, it's not, because the problem being addressed with consumer protection is power imbalance in the marketplace; mutually voluntary mechanisms cannot be the answer to it.

Also, escrow notionally solves exactly the same problem as cryptocurrency: providing the ability to rely on a transaction with an untrusted counterparty. If you need escrow for anything with cryptocurrency, the cryptocurrency is not doing the one thing that is it's defining purpose. So, why cryptocurrency at all?

> Virtually every case where consumer protection is useful is covered by existing laws and shouldn't require anything...

...except a lawyer, more money and a non-trivial part of your life.

Yes, that’s the failing. Ideally, justice should be cheaper in both time and monetary costs.

I don’t know of any state that has ever tried to optimize for a low-overhead justice system “in the small” (e.g. many, more efficient, more convenient small-claims courts; or the introduction of another triage layer of “medium-claims” courts, where most all civil contractual disputes would land) which is an interesting fact all by itself. Speedy+cheap justice goes somewhat hand-in-hand with things like red-tape reduction, in that both are attempts to “oil the wheels” of the state apparatus—yet you’d never hear the same people (e.g. libertarians) espouse both.

Aren't small-claims courts precisely an attempt to optimize for a low-overhead justice system in the small? Doubtless you feel they don't succeed or don't go far enough, but it seems odd to claim that nobody's tried.

That's what cryptocurrencies allow, since Bitcoin. People can pick a dispute mediator who gets involved and can reverse the transaction only if there's a dispute. It's all done with OP_CHECKMULTISIG. The mediator is not an escrow service and can't steal the money. So you end up with a competitive market of tiny "courts".

> I don’t know of any state that has ever tried to optimize for a low-overhead justice system “in the small”

Both small-claims courts themselves and rules giving effect to binding arbitration agreements are attempts to do that, as are many specialized, domain-specific administrative forums.

But if you are going to introduce a third-party anyway, why use crypto?

Because of crypto’s ”monetary policy”. And the point is you are not obligated to use a third party.

because even with a third party, it's still much cheaper, secure, and private.

I mean, except that it's actually not cheaper, you've just moved the trust and security problems around (to your own opsec and your trust in the counterparty) and the privacy most cryptocurrencies provide is pseudonymity rather than anonoymity...

But sure, other than all those things.

but I think, with traditional money exchange the reliance is on regulatory and legal enforcement, rather than making the technology itself watertight, which increases the risk profile, and thus cost. You can do this in traditional approaches because you just pass on these costs and there's no need to improve beyond what people are willing to pay. Crypto represents an asymptote for what a rigorously applied technological approach (as opposed to beaureaucratic/legal approach) can do, using commodity equipment, which is much more available at the endpoints of these transactions now ... (because most people have high-powered, always connected computers available to them).

> but I think, with traditional money exchange the reliance is on regulatory and legal enforcement, rather than making the technology itself watertight,

A lot of money and research has gone into this, and the tech is being tightened up all the time.

> which increases the risk profile, and thus cost.

Except the cost isn't actually higher.

> You can do this in traditional approaches because you just pass on these costs and there's no need to improve beyond what people are willing to pay.

In the US perhaps, not in places where these costs are regulated.

> Crypto represents...

A much more expensive and more risky way to do basically anything, because you have neither solved security nor trust problems, you've just moved them.

> A lot of money and research has gone into this, and the tech is being tightened up all the time.

Yeah, but it's not being deployed at consumer level, nor are the savings being passed on.

> A much more expensive and more risky way to do basically anything

Risky, yeah. Like any new technology. But transaction cost is cheaper.

Sorry, I didn't mean to get involved in some holy war. I can see there's people with a lot vested in both sides of the debate. I'm neither. Just pointing out the obvious.

> Yeah, but it's not being deployed at consumer level, nor are the savings being passed on.

It absolutely is, not sure where you're getting your ideas from here.

> Risky, yeah. Like any new technology. But transaction cost is cheaper.

It's not risky because it's new technology, it's risky because you've passed all the risk to the end user and their opsec. The cost per transaction of something like the VISA network is utterly tiny compared to most cryptocurrency transactions, particularly if you factor in the externalities (mining) and it's a pretty small cost to the merchant as well in places where regulation has been put in place (i.e. not the US). To the consumer it's free. See also bank transfers in most advanced economies.

> Just pointing out the obvious.

You're not pointing out anything that's actually true though.

> it's risky because you've passed all the risk to the end user and their opsec.

This was exactly my point. With pervasive crypto end users can assume this to a greater degree, whether you believe that appropriate or not.

Visa e.g. requires specialist terminal equipment, complicated issuer and acquirer and banking relationships and is heavily dependent on legal enforcement wherever you use it. Try using mastercard or visa in a third world country.

For “actual” money transfer, compare with western union where toure talking about ~10% fee.

> ... nothing that’s actually true

Oh you’re a rude one. But I’m sure to somebody you’re very special. Good boy.

>This was exactly my point.

It's not a point you made before this, you just said it was "more secure" and "cheaper" without qualification. Now you're just trotting out 'coiner memes about the third world and Western Union.

(You can use Visa in 200 countries by the way)

Have a nice evening, I'm done here.

I'm confused by your last paragraph. How does the existence of laws that protect consumers actually protect consumers if the payment systems we use don't allow reversals?

If an ebay seller delivers me a faulty product I can sue them for not delivering what I payed for and when I win the court orders them to pay the money back (plus my expenses). If they don't pay I can go after their assets.

It's basically the same how a business would recover money from a bad supplier. With small claims court it's even somewhat efficient for small sums, but of course still orders of magnitude more work than a credit card dispute.

That's an enormous burden. If we require lawsuits to enforce even minor cases of consumer protection, I argue that there is effectively no actual consumer protection.

The law not working for "minor cases" (which includes cases over hundreds of dollars) is exactly the failing of the justice system I mentioned. This isn't universal, in many places you can get theft of a Mars bar or possession of tiny amounts of drugs prosecuted very effectively, all cases much more minor than the typical credit card dispute.

So, rather than having a financial system with basic consumer protections (which would allow transaction reversals and contestation), you would prefer we have a criminal justice system which aggressively enforces and prosecutes minor offenses? I think there is a weak connection between the two, particularly since most situations where we do things like dispute a credit card charge are civil matters. And, as stated above, requiring civil suits for something like disputing a credit card charge is an enormous burden, and puts the burden on the consumer. (Which will also disproportionally affect the poor.)