@Eisenhower34 Those aren't the only problems with using reputation as a way to avoid fraud. The main problem I see is that it depends on your access to that information (reputation). Whoever controls that access, and determines its content, has a lot of power. Look at the media for example.
There does need to be some level of fraud protection as most people are not savvy enough to spot potential scams and as a result would end up losing money via scams and as a result there would be a lower overall level of commerce
But wouldn't people evolve to the point where they become more savvy with their money. Like any time they let someone hold their money there would need to be a lot of trust and assurances. Maybe it would reach the point, using multisig, that the likelihood of fraud becomes so rare that laws would be meaningless.
But we are granted a convenience in the thought that the government will step in if anything goes wrong so we can trust everyone.
It may just evolve on its own and the laws will become unnecessary on their own. The freedom that Bitcoin has provided is providing the solutions that laws have been providing for decades.
@both of you - any transaction between two people requires that trust be given to at least one of the parties to a transaction. You will always have the issue/problem that you could potentially be dealing with someone who has decided they want to leave the marketplace and as a result does not intend on completing their end of a transaction. Their reputation would be ruined however this would not matter because they do not intend in participating in the marketplace in the future.
Any market based on reputation will also put any new entrants of the market at a huge competitive disadvantage as they have no real way to earn the appropriate level of trust necessary in order to conduct business.