> without a middleman to protect us from fraud and theft
The blockchain and smart contracts serve this purpose. Regardless, there's additional protocols and tools being created for decentralized insurance, escrow, custodians, etc.
> The blockchain and smart contracts serve this purpose.
They do not, and the bitcoin blockchain in particular eschews identity verification in favour of pseudo-anonymity and puts people in charge of their own anonymous keys - perfect for criminals (anonymous enough to evade police) and states monitoring citizens (not anonymous enough to evade states, lasts forever for retrospective enforcement), but terrible for normal citizens who just want to be sure who they are transacting with and be able to get compensation if they are defrauded.
Blockchains and smart contracts are no substitute for real-world contracts enforced by courts and regulators, and the cryptocurrency attempt to supplant state currencies and their legal supports actively undermines any attempt to get regulators to seriously go after fraud. So instead regulators have classed them as assets (so they can tax every transaction in theory) and washed their hands of them.
The blockchain only solves the trust problem ON THE CHAIN itself. However, everything useful is going to involve something off chain, at which point we are back to having a trust problem.
Take, for example, the simplest use of currency... I want to buy an item that someone else is selling. The blockchain can verify that the buyer has sent the seller money, but it can’t verify that the thing the person bought isn’t defective. It can’t even verify that that person even delivers the item to me. It can’t verify that the item isn’t stolen.
Credit cards can help remedy the situation for all of those things.
The blockchain and smart contracts serve this purpose. Regardless, there's additional protocols and tools being created for decentralized insurance, escrow, custodians, etc.