I think a better way to say it is that it moves from a trustless system to a system that trusts based on some criteria. That criteria is usually how many coins one has.
Since the original bitcoin concept was solving the byzantine generals problem, the entire point of all the cryptographic work was to be trustless.
If you are cool with trust, you can have reversibility, lost password retrieval, anti-money laundering checks, and all the other features of the existing financial system.
It would be a carbon copy of that, of course, which would raise the question of what problem this system is solving for people.
But I understand that Ethereum is about distributed computing, not transactions, so the calculus may be different. The point being to replace AWS, not Western Union.
I'm personally not sold on why a distributed trust algorithm would be superior to trusting AWS or Azure, given that those services can give you a refund for errors, are subject to the legal system, have a brand reputation to maintain, and so on.
Since the original bitcoin concept was solving the byzantine generals problem, the entire point of all the cryptographic work was to be trustless.
If you are cool with trust, you can have reversibility, lost password retrieval, anti-money laundering checks, and all the other features of the existing financial system.
It would be a carbon copy of that, of course, which would raise the question of what problem this system is solving for people.
But I understand that Ethereum is about distributed computing, not transactions, so the calculus may be different. The point being to replace AWS, not Western Union.
I'm personally not sold on why a distributed trust algorithm would be superior to trusting AWS or Azure, given that those services can give you a refund for errors, are subject to the legal system, have a brand reputation to maintain, and so on.