> SendBank and ReceiveBank both lost the money and ACH members had to collectively bail it out (or a bank had to eat it).
SendBank sends $X dollars, ReceiveBank receives $X dollars. Imposter then cashes $X out of ReceiveBank (usually giving fake info). What's a scenario of fraud where this isn't the case? AFAIK there is no instance where the money simple disappears during transmission. FYI - This is why there is so much KYC done when you setup a bank account at a bank, so if you do cash out they can trace you.
> Arguably, for bitcoin, the fraud rate could be said to be 0%.
Agreed. This is exactly the problem (1) with crypto in general and (2) how difficult it would be to even calculate fraud for any cryptocoin.
There's four actors here. Victim, Criminal, SendBank and ReceiveBank.
Criminal initiates $X on behalf of Victim (or tricks them into doing so) using SendBank. Criminal then gets the money at ReceiveBank and usually withdrawals it before it can go noticed. Criminal therefore commits fraud against victim.
Since both banks are in the interest of keeping Criminals out and Victims (well just normal person/biz), they usually offer the ability to safeguard the Victim against financial harm, usually by paying the Victim money their money back and eating the cost. Hence why KYC is so important on both sides.
This is all conducted through a trust system that crypto fans love to hate because it's "centralized". AFAIK no crypto coin offers this ability because the trust system is inherently built on the idea that no person would ever be tricked into sending money to someone they didn't intend to, which is, ummm a downright terrible assumption about real world behaviors.
SendBank sends $X dollars, ReceiveBank receives $X dollars. Imposter then cashes $X out of ReceiveBank (usually giving fake info). What's a scenario of fraud where this isn't the case? AFAIK there is no instance where the money simple disappears during transmission. FYI - This is why there is so much KYC done when you setup a bank account at a bank, so if you do cash out they can trace you.
> Arguably, for bitcoin, the fraud rate could be said to be 0%.
Agreed. This is exactly the problem (1) with crypto in general and (2) how difficult it would be to even calculate fraud for any cryptocoin.