I really like what inputs.io is trying to do, but it complements on chain txs, it doesn't replace them. No matter how good a BTC-bank is, it still contains counter-party risk. Having low cost on chain transactions means you never need to store a sizeable portion of your wealth with third parties, and that is what BTC is all about.
Yep. We think a lot of our users will use Inputs.io as their day to day wallet for the benefits of no fees and instant confirms. But the blockchain will always have it's purpose - it is hard to beat trust-free.
Which essentially means off chain transactions are big f-you to the concept of Bitcoin. If you are okay with this, then you might as well just use USD and PayPal, what's the difference?
Are you aware that many Bitcoin core devs suggest off chain as a solution, and we've been in contact with them?