In reply to facepalmfrank.

If the goods or service weren't what was promised then initiating a chargeback can be less of a hassle than dealing with a retailer/seller that isn't willing to make things whole. With a credit card I can have my funds returned with minimal hassle. With bitcoin, I'm at the sole mercy of the retailer, who already has my payment in hand. While it may not be free for the merchant, and while credit revolver fees support paying for the chargeback department, it is free to the consumer to initiate the process (at least in the US)...and that's who's behavior has to change.

Escrows could work...but you need an arbiter, no? That role would cost money as well, yes? I've also read that in the case where no 'winner' can be determined that both parties can lose out on the funds...another poor value prop to the consumer.

As for replacing fiat...I'm having a hard time believing that a system whereby the proof-of-work and accompanying mining 'reward' can be sustainable. The system, at least in my mind, demands that the value of bitcoin continually rise to cover the ever increasing costs in power, equipment, cooling, etc as more miners join the system. With all serious mining being completed on machines that do only one thing...mine bitcoin...isn't there a major risk that a 'bigger, better, faster' solution comes out and the bottom drops out on the value of btc? I would expect to see a consolidation of equipment/power which dangerously undermines the entire system should one mining pool scoop up all the mining equipment for the players unwilling or able to stay in the game.

If ever there were a use case where bitcoin adds true value beyond what exists today, I'm thinking micropayments could be it. Otherwise I'm not sure where the average consumer sees any real value regardless of how cool it is...until/unless it's incorporated into traditional banking systems which undermines one of the btc communities favorite value props.