- we can create a way to use Bitcoins with or without chargebacks, and leave that choice up to users and merchants.Update
- this is actually not that useful
I'm sure similar ideas has been discussed before in various forms, yet I'm not sure that this specific implementation has.
The idea is to create a "sub-space" of reversible transactions within the Bitcoin address space.
This is a proposed breaking change to the Bitcoin protocol, designed to allow users a degree of chargeback to protect against scams and theft. The changing is a breaking change because it allows new types of transactions not permitted before.
The proposal entails dividing the Bitcoin address space into two regions:
1. Normal Bitcoin Space
2. Reversible Bitcoin Space
The NBS behaves like the Bitcoin we all know and love. Transactions within this space are irreversible.
The RBS is a subset of addresses (e.g. those beginning with a certain prefix), in which Bitcoin is treated as reversible.
NBS to RBS transactions are treated as normal transactions, and are irreversible.
Any RBS to RBS or RBS to NBS transaction can be reversed by its issuer within some period of time / blocks. This will give users the power to chargeback ... with all the pluses and minsus this brings. E.g. the Linode hack could not happen with RBS Bitcoins, because the transaction would just be reversed when discovered. There could even be multiple RBS spaces with different "grace periods".
After the grace period is over, the RBS transaction becomes locked and cannot be charged back anymore.
So, this gives users and merchants the option, not obligation, to support reversible transactions in Bitcoin. A merchant can give a discount to NBS payments, and offer RBS transactions at higher prices. For industries where the customer is well known or there is just very little overall fraud, the merchant wouldn't mind accepting RBS transactions, perhaps with the additional requirement of some form of identification to further deter frauds from issuing chargebacks without just cause.
For the user, the advantage of keeping his stash in RBS is clear - their Bitcoins are much safer there.
For any merchants or users that don't want to take part in all this nonsense, they can stick to the normal NBS space.
The question is - is there enough demand for reversible Bitcoins? This would be a significant protocol change that will probably take 6-12 months to implement because of "legacy" systems and the requirement to get a hash power majority for the change.
Come to think of it ... I'm not sure using a sub-space is actually better than using a separate blockchain. The benefit to using the same blockchain is removing the need to gain hash power for the separate chain, and maintain the value of NBS Bitcoins identical to RBS Bitcoins. The huge downside of course is that it's a huge breaking change, that is not likely to ever get a miner or dev majority.
I think it's important to have the inherent value of RBS and NBS as equal, and allow for easy two-way conversion (conversion from RBS to NBS just takes some time, but its value does not fluctuate). I don't think people are ready yet to think of their money in terms of multiple distributed cryptocurrency values ... being exposed to a single volatile exchange rate is risky enough.
The question is whether there's a way to construct an alt chain where the coins will always have the same value as Bitcoin ... and I'm not sure that there is a clear way to construct such a chain. The so called Second Bitcoin Whitepaper
had some ideas in that direction, but nothing that ultimately convinced me.P.S.
Perhaps all this is a redundant complication, and can instead be achieved more cleanly with scripts. Have there been concrete proposals in that direction? (Links please)