Bitcoin shifts damage exclusively to the consumer. I have no economics background, but aren't there more consumers then merchants? Aren't merchants themselves consumers? PayPal is not a perfect system. Bitcoin does not offer improvements to the consumer- just to the seller.
Legit consumers pay for the cost of fraud by dishonest consumers.
From an outside perspective, I think it's a huge mistake for you to tell me that you don't want my business. I wouldn't bring a huge amount of money into the market, sure. but what about anyone else who is looking for the pros and cons of Bitcoins to the consumer and find this thread? I'm giving you a chance to make Bitcoin appealing to more people, and so far the most attractive thing I've heard is using it as a Western Union alternate.
It doesn't have to be either/or. Bitcoin can co exists along with traditional "reversible & centralized" payment systems. Likewise 3rd party services can be implented on top of Bitcoin to provide reversable transactions (if both the consumer and merchant want to). No reason an entity like VISA couldn't exist in bitcoin world. You buy with bitcoins. The BTC are transfers to BISA. BISA deposits funds to merchants Bitcoin account minus a holdback. After 30 days holdback if released. If a dispute happens customer contacts BISA and can be refunded from the holdback. Not saying it SHOULD happen but if there is market demand it could certainly happens.
VISA is merely a reverseable abstraction on top of cash.
"BISA" is merely a reversable abstraction on top of Bitcoin.
Cash currently can't be reverse. No mechanism for doing a cash chargeback. Bitcoin is simply a truly cash equivelent for use online with all the advantages and disadvantages that go with it.
This is true, but it's harder to be scammed by cash based merchants. It's possible, but generally if you walk into an office, store, or artist you can get a feel for the quality of work/product. There is also a lot more work involved on the scammers part, and the potential rewards are nominal for most products/services. Excluding unsolicited salesmen approaching me (the physical equivalent of wealthy Nigerian widows), I can shop with some faith that my cash isn't going to end up just vanishing.
And yes, bitcoin does have to be either/or to see the benefit. The main selling point of Bitcoin- what I've seen time and time again, is that If i am a merchant, I will never have to deal with chargeback fraud. But if i accept Bitcoin and PayPal, the people who are honest enough to use Bitcoin wouldn't scam me in the first place. As long as I accept Paypal, I have to worry that I will be given false chargebacks. I would want to encourage people to use BTC, if not outright exclude PayPal.