Bitcoin does have a way to implement better consumer protection. It's called multisig. The idea being that a special kind of bitcoin address is created from three keys. If any two of the private key-holder, the money can be moved. So to create a robust consumer protection model you give the buyer, seller and an arbitrator each one key. The buyer pays into the multisig address, if the buyer receives the service and is happy, her and the seller can both use their private keys to send the money to the seller. If they can't agree then the arbitrator can use her private key to tie-break and distribute the money as they see fit. Also the arbitrator can't steal the money on his own as they only have one key, so they don't need to spend time and money on security.
I like this paragraph and would be happy with this for my merchant activities. Because arbitration is new for some of us coming from Ebay and Etsy it would help people feel more comfortable if we know that arbitrators would only have one key and there was no possibility of arbitrator theft.
I like many of the points you made and this issue needs a lot of attention as we are starting to see the first decentralized marketplace options appearing.
It is so important for the consumer AND merchant to feel comfortable doing business if we want more adoption. Whoever nails this first will have the most successful marketplace.
On the contrary, I believe customers are very used to arbitration in Ebay and Paypal. They don't call it that word but they know they can get their money back if the deal goes bad.
It takes more than a marketplace to make smart contract escrow easy. All bitcoin wallets need to be integrated into the system too, for a 2-of-3 style multisig the customer's wallet needs to send it's public key to the arbitrator somehow.
We saw how long it took wallets to be able to send to p2sh addresses, having them all adopt this pubkey-sending thing will probably take a similar time.
