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Robosats and Bisq Fiat Problem (at least in Brazil)
3576 sats \ 19 comments \ @falcoonbr 24 May 2023 bitcoin
Here in Brazil, govmnt started to force bitcoiners to report trades with our national ID, amount and price and if the trades are above 6,5k USD (converted) per month we are subject to pay 15% of our gains over all trades automatically on our annual tax sheet, that alone shouldn't be a problem, but a lot of our P2P traders (otc trades) are being quesitoned by the police if the amount of money is too high, and people are getting afraid to trade on the national exchanges due to kyc and auto-report (here, the exchanges are required to report all user activities to our govmnt).
That leave us with the no KYC option to trade, robosats and bisq, but there's a catch: FRAUD and REVERSAL.
Either one doesn't seem to worry about funds being reversed after the trade has been completed, and the sellers are left to harm and losses.
Bisq:
On Bisq we have an account age system, that tells us the age of an account a user has registered on bisq, that is partly good because a fraudulent party usually wouldnt be able to cash out a fraudulent account twice, but this is not enough reputational system to avoid reversal, if the buyer reverts its fiat transfer, then the seller can't REPORT that incident after having completed the trade, and the banking system here allows anyone to revert a fiat transactions for even after a week.
On defunct localbitcoins at least we could report fraudsters/reversals AFTER the trade was completed, flaging those buyers so they couldn't coup another seller.
Bisq on the other hand has it account aging system that shows the age of account of the seller (which can't cheat the trade, once the bitcoins cant be reversed), and buyer, but after the seller receives the fiat, it doesn't prompt the seller if the fiat transfer came from the buyer registered account, so he could send money from a third-party account anyway and play the old man-in-the-middle coup.
As for robosats, they don't have any reputational system at all, all robots are anonymous and after btc ln has been sent, the sellers are all at risk for reversal and fraud, and the fraudster can use robosats again to steal from another seller.
Since the money comes from DOXED accounts anyway, why dont robosats and bisq have a solid reputational system based on the accounts used to transfer the fiat?
Should be simple, buyer executes a sell order, seller's account info shows on his screen, and the buyer's account age shows on sellers screen as well, right after buyer clicks payment completed, bisq / robosats then follow up prompting the seller: THE ACCOUNT USED TO PAY THE ORDER IS THIS ONE (shows buyer's registered account info), in case it isn't, then the seller has the option to return the payment to original account and prompt the buyer if he received his payment back and both cancel the trade!
I know, somewhat painful, but sellers should have the option to turn this verification on, and buyers have to agree that if they're gonna execute such seller order they should only transfer money using registered account info.
The way it is right now it promotes fraud, because the buyer will always have their bitcoin and seller is left with the losses.
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38 sats \ 3 replies \ @flix2 24 May 2023
I read that Pix in Brazil is not reversible once confirmed. Is this correct?
If yes, then that would solve OP's issue.
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0 sats \ 2 replies \ @falcoonbr OP 24 May 2023
That's the opposite, pix is more reversible because it can be initiated by the user, and the other method (ted) needs to be initiated by the bank (the user needs to request it, and bank needs to aprove it).
Problem using TED is that we need to inform OUR CPF (national ID) to the buyer in order to receive TED, and that cause a problem because buyer can report this trade to our IRS (receita federal) withou our authorization!
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0 sats \ 1 reply \ @flix2 24 May 2023
According to this:
https://www.bcb.gov.br/en/financialstability/pixfaqen
"After confirmation, the Pix settlement occurs in real time, and the transaction may not be cancelled. However, you will be able to negotiate with the payee the return of the amount paid. The reimbursement is a functionality available on Pix and is always initiated by the payee."
...once Pix payment confirmed it cannot be reversed or cancelled... but I suppose that it might be incorrect.
Please tell us more.
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0 sats \ 0 replies \ @falcoonbr OP 24 May 2023
They implemented by the end of 2019 the SRM (MED):
Special Return Mechanism
The Special Return Mechanism (SRM) comes into play in cases of well-founded suspicion of fraud, whether actively identified by the institutions involved or when a user initiates a Pix transaction but soon realizes they have fallen victim to a scam. In such situations, it is necessary to file a police report and immediately notify the institution through official channels, such as customer service or the ombudsman. Within the Pix environment in banking apps, there is a direct link to the designated channel for filing complaints.
The victim's bank, in turn, will utilize the Pix infrastructure to notify the receiving institution about the transfer, so that the funds can be blocked. After the blockage, both the payer's institution and the potential scammer/fraudster's institution have up to seven days to conduct a more thorough analysis of the case to confirm that it is indeed a fraud. If the fraud is proven, the destination institution of the transaction returns the funds to the payer's institution, which must then credit the customer's account accordingly.
You don't actually know there is a file from the buyer, and you get your funds returned by surprise, so at the sellers point of view, there's no wait time, since he doesn't know there's a complaint.
Pix favors buyers, ergo, buyer is innocent until seller proves otherwise!
https://www.bcb.gov.br/detalhenoticia/591/noticia
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38 sats \ 0 replies \ @gnilma 24 May 2023
Sounds like a fiat payment problem than a trading platform problem. Like many others said, use irreversible fiat payment methods or fiat payments that are really hard to reverse.
Since the money comes from DOXED accounts anyway, why dont robosats and bisq have a solid reputational system based on the accounts used to transfer the fiat?
I believe this is already being done in Bisq, no? As a buyer, you have to create a payment method for your account, and if the payment method is related to online bank transfers of some sort, you have to enter the name that is the same as the name in the fiat bank account. As a seller, you can verify that the fiat indeed came from a bank account with a matching name as the name on the payment method shown in Bisq. If there is a difference, you can always refuse to release coins and initiate mediation or even go to arbitration. Also, verification doesn’t happen on the account level, it happens on the payment method level. Each time a buyer adds a new payment method, that payment method needs to get re-verified (successful trade with another user with a verified payment method and wait 30 days), which means buyers can’t simply use “burner” payment methods.
At least above is the case for e-transfer payments methods in Canada. I have not used the Brazil payment methods, so don’t know if it different.
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19 sats \ 0 replies \ @Darkbulb 24 May 2023
Never had fraud on either site, only positive experiences at least with USD
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50 sats \ 3 replies \ @2bithits 24 May 2023
I guess you would need to use an irreversible fiat method like cash in hand or gift card. Or let them know that you will wait 2 weeks to verify received fiat so they cannot reverse the payment
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0 sats \ 2 replies \ @nerd2ninja 24 May 2023
Cash by mail, but that doxxes the seller which could cause them trouble in a country with a hostile government
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19 sats \ 0 replies \ @OriginalSize 24 May 2023
Always wondered why people don't try something like physical onion routing. If there's collateral for each leg it seems like it could work.
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0 sats \ 0 replies \ @2bithits 24 May 2023
It could be something like a PO box or a package receiving company.
By the way, using a bank account doxxes the seller too
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10 sats \ 0 replies \ @om 24 May 2023
Funnily enough, CBDCs might help with this because they're supposed to be irreversible.
But yeah, that's a big problem.
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110 sats \ 1 reply \ @cryptocoin 24 May 2023
Either one doesn't seem to worry about funds being reversed after the trade has been completed, and the sellers are left to harm and losses.
That's not a flaw with Bisq or RoboSats, that's a flaw with the payment method.
If your payment method that scores poorly on the May scale of monetary hardness, then RoboSats (which by design provides a new robot for each trade) is most definitely not going to be a good platform for trading.
What is needed is street-level trading of bitcoin, just like how Bureau de change / foreign currency conversion dealers operate. This can happen with Bisq and RoboSats, but using the in-person / face-to-face cash trading payment methods. Inconvenient? Sure. Much less so then being defrauded.
As far as P2P trading platofrms that are free of identity verification / KYC, there is also HodlHodl and LocalCoinSwap.
Person-to-Person bitcoin Trading Platforms https://cointastical.github.io/P2P-Trading-Exchanges
I don't know if P2P Cripto is either legit or free from identity verification/KYC but you could give that a try:
It's in the above list with a domain name that redirects to:
https://p2pcripto.com
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25 sats \ 0 replies \ @falcoonbr OP 24 May 2023
thanks, i'll check them out!
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10 sats \ 1 reply \ @DarthCoin 24 May 2023
Don't trade. Earn in BTC, spend in BTC, hold in BTC. Fuck all the rest.
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0 sats \ 0 replies \ @falcoonbr OP 24 May 2023
I have people here from UK that needs local cash, but they pay in BTC, to provide them cash, I need to sell their btc, rinse and repeat! Not an option to deny them service!
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0 sats \ 0 replies \ @flix2 24 May 2023
It is almost impossible to have reputation without some form of identity and identity opens up a lot of attack vectors.
Bisq and Robosats both have security deposits which make trades extremely secure for the buyer (since seller's BTC are locked up until payment is made).
However for the seller there is more risk, which can be greatly mitigated by using irreversible payment methods for fiat... or at least ones which are very hard to reverse.
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0 sats \ 0 replies \ @xmrk2 24 May 2023
Why not use cash deposit into the seller's bank account? Difficult to scam or reverse. But not impossible - I was selling btc and was scammed by man-in-the-middle, and convicted for fraud (just fined, no jail time). Already wrote about it somewhere. You should be able to prevent MITM by asking the buyer to write "buying btc" on the bank slip and sending you the photo.
Another option - HalCash and similar - buyer's bank sends the btc seller an SMS containing PIN to withdraw the cash at the ATM. So the seller actually receives cash. While HalCash is limited to Spain, I think there are similar systems in other countries. Slight disadvantage is that at least one of the trade partners needs to reveal his phone number to the other. And there are limits - I think 600 euros per one transfer and 3000 eur / month.
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0 sats \ 0 replies \ @Louferlou 24 May 2023
The problem with a reputational system is that it kind of leak at least how many trades you've performed, as you have to calculate the average rating of the user ?
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0 sats \ 0 replies \ @flix2 24 May 2023
Use an irreversible payment method for fiat.
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