[yaa_minu]

I know hn is not crypto friendly but crypto payments don't have this problem at all. Many of the heurestics used to defend against these problems too end up hurting we those in emerging markets including even cards issued by local banks. I hope merchants adopt crypto based payments more and more as an alternative.

[andrewxdiamond]

Crypto not supporting chargebacks/disputes is not a feature. CC companies / processors are required by law to support these workflows as consumer protection.

This situation can still happen exactly in a crypto world, but it’s the consumer getting screwed instead of the business.

[yaa_minu]

In what ways would a consumer be screwed if crypto payments become dominant? I'm genuinely curious

[andrewxdiamond]

In the stripe scenario, consumers have had their CC info stolen. Bad actors are now working through that list, abusing this business.

In a crypto world, a consumer would have their key pair stolen and immediately be completely broke because everything can be instantly and irrevocably stolen.

[yaa_minu]

Understood but in the case of crypto, you don't hand over your private keys to third-parties unlike cc where you have to hand over every information about your card in order to make payments. Thi is the main vector of stolen credit cards so I fail to see this as a serious problem.

[throwway120385]

There's an unfounded assumption in what you're saying: people make mistakes. In the current system without non-repudiation, we can repudiate our mistakes and get our money back. In your crypto-based system, if someone tricks me into divulging my keypair and impersonates me, I can't repudiate that transaction so it's gone forever. And so you're perpetually one mistake away from losing everything which was what the consumer protection laws are protecting you from in the current system. They protect you from losing everything for one mistake.

[naet]

Crypto is stolen every day. You can argue the theoretics of it but if you search google or Twitter for "crypto stolen" you'll get tons of results every day of people having their funds unexpectedly drained.

Crypto maxis always like to argue that crypto theft isn't possible, but the reality is it happens a lot and there's no recourse when it does (which is what makes it an attractive target).

[UncleMeat]

This isn't really a property of cryptocurrencies, but a property of signed transactions. We could absolutely have traditional banking transactions online where you don't give the information to the PoS that is sufficient to create a new transaction. In fact, this is exactly what chips are doing in an in-person transaction. The hard part here is getting everybody to have the right equipment and software to sign these transactions when purchasing stuff online.

Cryptocurrency does not actually solve this problem. It just gives people a greater incentive to push through the pain of solving this problem.

[mrguyorama]

There's zero possibility for tech to fix the main step of fraud in money, which is social engineering. Being unable to fix a mistaken transaction is not a feature.

[andrewxdiamond]

I thought about that. Funny enough crypto and CCs are very much based on the same model.

CCs have chip mode. Chip mode transactions are impossible to spoof. They are one time transactions protected with nonces and very good cryptography. But CCs have a weakness when used online because you have to enter in your secret numbers to use them. When these secret numbers are entered into a fraudulent website, that bad actor now has access to your card _until the CC company stops it_, either at your discretion or their own.

Crypto is quite fancy, but you can’t solve wrench problems [1] with technical solutions. Consumers are still going to fall for phishing attacks, they will still accidentally loose their keys. The only difference is the consumer has no recourse. They are good and properly screwed.

Example: someone holds you at gunpoint and demands your secrets. With CCs you just hand them over, then as soon as you can call in and dispute all charges. If a guy with a gun demands your pub/private Keys, I’m not sure what you would do.

I supposed that is a boon for business, and business rules America, but unfortunately this is another problem that crypto does not solve.

1: https://xkcd.com/538/