Then there will be fraud. Lets say I sweet talk a newbie into using paypal, I con them they send bitcoins I send the dollars. Then I issue a chargeback, BAM fraud and there is no jury to fix it. Or lets say I want to pay for some bitcoins but the other user wants to wait for the wire to clear before sending me bitcoins. Then during that time, bitcoins drop down to $90, I just missed a good buying point now I am mad.
There is just not an easy way, and gateways help with this so everyone has a fair chance.
There's always gonna be fraud. And there's certainly solutions to prevent it..
- Multi-sig transactions
- Escrow services
- Reputation, web-of-trust systems.
EVERY #$%^ argument against a decentralized exchange I there is an answer for. I challenge anyone here to give one that can't be solved.
Decentralized exchange would be superior to any exchange we have right now. It's gotta be done if Bitcoin is going to scale.
So I have to now get escrow services to buy coins and web of trust is really broke so that doesn't work, so now I could never bot trade.
Simply vet your sellers and buyers before hand. Setup your bot to deal with vetted buyers/sellers.
And/or set bot to only deal with buyers/sellers according to pre-set parameters.
The vast set of buyers/sellers will also create far more arbitrage opportunities for a bot properly setup.
...Escrow transactions don't necessarily required a service, just multi-sig.... which will become ubiquitous soon enough.
C'mon, get a little creative. There's no reason bot trading couldn't be done an a decentralized exchange.
You just described a centralized exchange, I should only setup with vetted buyers and sellers.
Ummm.... hello.... nothing centralized about that. You have as many buyers and sellers to choose from as there are in the system.
Try again!
You know just as well, that there will be a few people that get most of the business what makes that different from mt gox or bitstamp?
