Centralized authority. With the obvious tradeoffs. :-/
Maybe there's a happy medium where trustworthiness of central authorities is appropriately distributed, but common operations are quicker and less wasteful.
The happy medium has been found already. Would people trust Visa and MasterCard if they allowed double spending? I'm guessing not. So by virtue of having a very large investment in their corporate brands, the old economy already came up with a solution to the trust problem.
Heck, everywhere you look there's a solution to the trust problem; it's fundamental to human interactions.
- There are courts. If you try to screw me, I can drag you into one. Nothing's perfect and there's probably a minimum amount I'd not bother Judge Judy for, but it's a solution a LOT of people rely on. And I can tack all sorts of things on to this like warranties and insurances.
- Brands. Look, we burn all this money on getting sports stars to pose for pictures. And there's reviews of our product in papers. If we did something stupid, you'd know. Again, it ain't perfect.
> Maybe there's a happy medium where trustworthiness of central authorities is appropriately distributed, but common operations are quicker and less wasteful.
I’m working on this. It’s an implementation of a protocol called Stroem, which uses payment channels to transfer bitcoins from consumers to so-called issuers, who issue payments in exchange which consumers then send to merchants. Then merchants collect these off-chain payments from issuers, and redeem them into bitcoins on the blockchain when they wish.
This system compromises with the security of the payment receivers only (the merchants). Everything is trustlessness for the payment sender/consumer, while merchants need to trust issuers. But, if desired, the merchant-issuer trust can be reduced to almost nothing by the merchant redeeming very often (at the cost of higher fees).
And, importantly, the open nature of the protocol will ensure competition between issuers, since anyone can join the network.
Heck, everywhere you look there's a solution to the trust problem; it's fundamental to human interactions.
- There are courts. If you try to screw me, I can drag you into one. Nothing's perfect and there's probably a minimum amount I'd not bother Judge Judy for, but it's a solution a LOT of people rely on. And I can tack all sorts of things on to this like warranties and insurances.
- Brands. Look, we burn all this money on getting sports stars to pose for pictures. And there's reviews of our product in papers. If we did something stupid, you'd know. Again, it ain't perfect.
- Escrow. Don't trust me? Trust this guy.