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Comment by banachtarski | Hacker News Reader

> Receiving money without being exposed to the danger of fraud. Receiving money via Credit Card is surprisingly risky for the merchant.

We have this well established thing called a credit score which is handled by the credit card agency and resolves trust issues for the merchant entirely. If a person suspects identity theft, they can put a hold on a card, preventing further use. Cards have expiration dates and periodically cycle out. I'm sorry but when people explain to me that using a token they are personally responsible for encrypting is "safer" somehow, I raise my eyebrows.

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>We have this well established thing called a credit score which is handled by the credit card agency and resolves trust issues for the merchant entirely.

We have this well established phenomenon called 'data breaches' which has compromised nearly everyone's credit/personal data.

Your info is on the dark web. Lots of databases that can be cross correlated. Banks increasingly don't know who they're dealing with, fraud is increasing.

Consumers don't need to worry about this though: all fraudulent charges are removed from the customer's account and are somebody else's problem. The customer gets a new credit card sent to them, sometimes even overnight, for free.

I've had both credit and debit card fraud happen to my accounts: it is a pretty minor annoyance.

(A data breach of my Social Security Number would be a whole different story however!)

Then why do merchants (especially startups) suffer so much from the credit card fraud problem?

https://hn.algolia.com/?query=credit%20card%20fraud&sort=byP...

Because that is how we've decided to allocate the risk. There was a time when that allocation was different (and that users could be more liable for fraudulent use of their cards), but, at least in the U.S, we decided we didn't like that and legislated it away.

In the past couple years, my credit card number has been scanned at least 3 or 4 times from (likely) gas pump readers. Those scans resulted in transactions that I didn't have to pay for (but some merchant did).

and with bitcoin that type of attack is impossible

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