I am trusting that outside entity in a number of different ways; To only take the required amount, b.) encrypt my information to prevent my information from leaking.
Credit card data is leaked regularly in mass uploads for pennys on the dollar. Credit card fraud is mediated by the credit companies themselves and is just an insurance issue to them.
Crypto, I sign the transaction to send it to you. You don't get anything but my public id, amount and block time.
Even with debit cards you have 3D secure these days which requires confirmation on your phone.
Just because USA is behind in banking department and even credit/debit card thing doesn't mean those problems are especially hard to solve. The rest of the world is already partially there and with more fintechs putting pressure on banks things will improve even more.
Also, you are trusting that the person you are sending money to honors their agreement as there is no intermediary to dispute transactional claims.
[0]: https://www.cardbenefits.citi.com/Products/Virtual-Account-N...
I think another thing to note is that the other party is ASKING your bank/credit issuer to debit. The transaction can be stopped if not approved.
Normally I see the argument for crypto being that this helps merchants by avoiding charge backs, etc.
I don't understand this. You're saying if I send you $0.01 via internet banking, you can somehow take everything in the account?
It doesn't work this way in NZ, where it is common to put your bank account details on invoices so people can pay you directly.