Except the bank gives you full protection on your money.

Your example would be more like: dedicated machine = your mattress, 3rd party service = money you have in your pocket

What happens if you lose your wallet(s)? Or if you screw something up and lose the private keys somehow, or send money to the wrong account? There needs to be a 3rd party that manages security and gives you full protection against anything that happens.

Yes, there ARE people who don't trust banks and keep money in their mattress, or hold onto a bunch of gold coins, but those are a very small minority. The typical person keeps their money in a bank.



Ok, so if you're buying physical goods from an online merchant, what benefit exactly do you get by paying with bitcoin over a credit card?

doesn't mean shit.

Anyone can go there to create a wallet as long as they type in a name (not even a real name) and an email address.

Yeah, you have to take responsibility and get nothing in return. That sounds stupid to me.

For example, tigerdirect accepts bitcoin, but why would you?

For one, if you're unhappy with anything, you have to deal with their customer service only, and if you're unhappy with the results, too bad. If you use a credit card, you have recourse by going to the credit card company (which generally sides with the cardholder).

And you pay the same amount of money, actually more money when you consider the fact that a lot of times you get cash back or reward points with credit cards.

No chargebacks benefits the MERCHANT, NOT the user. I've had issues with merchants before (big companies too), and it was either spend hours on the phone trying to get it resolved, or take 5 minutes, do a chargeback, and let things work themselves out on their end (they eventually contacted me about it).


Identity theft is a whole separate issue. The information you give when making a credit card tx is nowhere close to what someone needs to steal your identity. All you're giving with a credit card tx is the account #, expiration date, CVV code (and all those 3 can be changed instantly by the card issuer), your name and billing address (which is information you can find on public records).

Bitcoin only offers merchant protection when it comes to most things (if you're ordering something you need to give your name and address anyway). With credit cards, there is no due diligence required by the consumer. You're not liable for any fraud, only the merchants are.

The only time bitcoin protects the user is when you're doing something you want to keep anonymous.

Here's the issue with bitcoin.

No chargebacks, and you need to store/protect your private keys.

That's a BAD thing.

When I buy things online, I buy with a credit card. I don't have to do any research into whether a merchant is reputable or not. If it doesn't show up or is not as advertised, I make a phone call and get my money back. I don't have to worry about protecting my information, because if it's stolen, I make a phone call, get my money back, and get a new card issued.

For fiat, it by itself has no protection, but banks, a trusted 3rd party, and the FDIC protect it. If your bank account is hacked, you get your money back. If there's fraud of some kind involved, you get your money back. If your bank goes bankrupt, the FDIC covers up to 250K of it, which is sufficient protection for most people.

In order for bitcoin to appeal to the masses, there needs to be a trusted 3rd party who can offer a payment solution that includes dispute resolution and chargebacks, 100% protection for your account being hacked, basically removing any kind of responsibility or liability from the end user. And I'm not talking about a "trusted" 3rd party like coinbase, or bitstamp. The service would have to be offered by an organization like bank of america.

To the average person, there's no appeal of bitcoin. It puts the onus on YOU to protect your money and making sure the merchant is reliable. I've lost one of my credit cards while on vacation, didn't even worry about it till I got back. If that were bitcoin then I'd be panicking about losing a ton of money if I didn't resolve it immediately.

lol, bitcoin is like the perfect currency for people doing something illegal.

Why would I want to use bitcoin to buy say, computer parts, when I can use a credit card and have the ability to do a chargeback if there's any issues?

You can buy ASICs for $4 - 5 per GH

Your hardware is worth like $150 tops.

Because you gotta sit there all day and place a ton of small bets on a bunch of different sites.

Actually it's pretty simple. Any of those dice websites that roll on a 0 confirmation tx, you confirm the tx if you win, double spend the tx to your own account if you lose.

How would the members find out? It's not like the pool is going to send out a notice saying they're partnering with a thief.

Right, but pools typically pay out the majority of the revenue to miners. If they solve 20 blocks a day and 1% of that is profit for the pool, they make 5 BTC a day.

If a pool of significant size aided me w/ double spending I could easily steal 100 BTC a day and give them half of that.

Are there any mining pools who would be willing to make deals like that?

I would, of course, be willing to pay a sizable cut of the profits generated from accepting my double-spend Txes.

Hmm, what I need to be able to do with spending an output twice though is the following:

Create a transaction (no tx fee), send it.

Wait 30 seconds.

Create a different transaction spending the same output (with tx fee), send it.

Would that work? The 2nd tx should get confirmed first since it has a tx fee even though it was sent after.

First off, how do I disable the transaction fee for low priority transactions? It forces a transaction fee even though I set it to 0.

And what's the easiest way to spend an output twice? (Yes, I'm fully aware of the fact only one of the transactions will make it into the blockchain and be valid.)