Here's the issue with bitcoin.
No chargebacks, and you need to store/protect your private keys.
That's a BAD thing.
I don't think you get bitcoin. There are solutions for chargebacks by using escrow. However, bitcoin is very similar to cash. With cash, you must physically protect it against theft. With bitcoin, you must prevent your private keys from be stolen. Most of my BTC is on paper wallets (with no possible online access to the private keys) that reside in my safe, along side my cash.
If you don't trust yourself to insure the protection of your private keys, then using a bank might be your solution. Ask bank account holders in Cyprus, or gold holders in the United States that kept gold in safety deposit boxes during the US gold seizure of 1933, if that method is the most secure.
Escrow = Trusted 3rd party.
With cash, it must be protected against theft, but that's the bank's responsibility, not the end user's.
OP you should really consider the differences between the two systems.
The only reason charge backs are necessary with legacy financial systems is that your money can be authorized by someone other than yourself. Somebody can hack into a merchant database (Target) and gain access to your card information. From your card information they can access your name, address, phone number; then other private information becomes easily accessible from the information stored within the credit system, social security number, identity as a whole. That person can use those numbers to buy whatever they want in your name.
Charge backs do nothing to deter crime; they hurt everybody else involved. Charge backs can bankrupt a small business, lay off the employees, cause a tremendous amount of collateral damage. The only person unaffected in a charge back is the criminal.
With Bitcoin that is not the case. Nobody can spend your coins, your public address is encrypted to where it can't be used to identify your private address. Unless you give somebody the private address to your bitcoin wallet and your password they won't get your coins.
If somebody installs a key logger on your computer they have access to everything you do on your computer. Your bank accounts, email, social networking, identity, etc... It takes more than a key logger to steal your Bitcoins; they will also need to steal your wallet file from your computer.
When a merchant doesn't deliver the product you paid for you have a legal recourse, the criminal (merchant) is affected, and the criminal is punished. Why do you need a charge back with Bitcoin where nobody else can spend your money for you?
Someone hacking into a merchant database does NOT get info in the credit system, like SSN. All they can get is the info you provide to the merchant. Name, Address, information about that specific card (which can be cancelled and reissued). Chargebacks are for more then reversing unauthorized transactions. I've done chargebacks because I was unhappy with the way a merchant handled something, and no longer wanted to deal with the merchant. And if a merchant doesn't deliver, with bitcoin you have to go to court to sue them to get your money back. With a credit card or bank payment, it's a 5 minute phone call to get your money back. Good luck suing someone for a few hundred bucks.
Taking responsibility is so haard.
Yeah, you have to take responsibility and get nothing in return. That sounds stupid to me.
You get plenty in return. Just because you don't care about those benefits does not mean they do not exist.
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?
I don't hold the opinion that Bitcoin's best use case is as a daily spending currency.
But, since you asked, there are a few.
In order to get a merchant to accept a credit card, you must provide all the information required to actually use the credit card (billing address, name, credit card number, expiration date and card security code). Bitcoin is much more secure, you don't need to provide
any information in order to make a payment.
Bitcoin is like cash. Merchants can offer a discount for payments with Bitcoin since they don't have to pay a processing fee or worry about charge backs.
I don't need to pass a credit check to obtains bitcoins. I need to pass a credit check to obtain a credit card.
Credit card companies can block payments at their discretion. No one can block a bitcoin payment.
Ok...
Name and billing address (assuming you live at your billing address, most people do) you have to give the merchant regardless if you want to receive what you paid for. The card information has zero security implications. If that gets stolen you have exactly zero liability as a result. (The time I lost my card -- totally my fault btw, I didn't bother to report it stolen until a week later -- it took me 5 minutes on the phone before all the txes were reversed and a new card was on it's way).
Merchants can offer a discount. True, but currently the big ones that I'm aware of charge the same amount in btc. Also, offering different prices for credit card users vs other payment method users often violates the terms of the merchant account with the credit card company, and they're subject to have that terminated. Merchants giving up all their credit card business to give btc users a discount? Doubtful. I don't know if you remembered, but gas stations had to go through a huge fight to be able to charge cash and credit users different prices.
Credit check. Valid point. Not everyone can get a credit card. Debit cards offer the same protection as credit cards though and only the lowliest of the low can't get a bank account.
Credit card companies CAN indeed block payments at their discretion. But the majority of those cases are when something illegal is involved. In this case, I would agree, bitcoin is a great currency when dealing with anything illegal, and is far superior to anything cash based in any way. But for legitimate uses? I don't see the incentive for the consumer to choose bitcoin.
Bitcoin is great for online gambling, buying drugs, laundering money, or payment for other illegal products/services.
You're right, there must be a reputable third party.
