The third-party is indeed murky. There will always be people, even in decentralized cryptographic systems — that is I think where utopianists stumble. Decentralized systems also have their points of concentration. So a lot of nuance. That said, again, we get back to the *spirit* of the system.

The examples of Currency exchanges being hacked is a good example of that. There is no central authority there to go to to reverse the transaction. There’s no one to go to — even the Bitcoin developers cannot reverse that transaction as all they code are the rues at the protocol level. If so, the police would have those bitcoins in the hands of the exchanges by now, easily.

In a bit of a dark, twisted way, those hacks (and the fact that nobody has been caught yet) are actually examples of bitcoin working as intended: the closest replica to cash in the digital world. Just like cash, if you lost your wallet — there is no one to go to. No one to reverse it because transactions, whether in these sense of being stolen or just for buying a piece of gum, have a level of finality and irreversibility.

In those news items (bitstamp, Bitfiniex)the blockchain was actually not subverted. The analogy in those cases would be like saying that the “dollar was hacked” if someone stole cash from Citibank. The cash actually worked as intended. Citibank was hacked.

A more proper analogy would be saying the “dollar was hacked” because someone counterfeited and ‘created’ dollars successfully, or got possession of a dollar printing machine — something that has yet to happen on a large Blockchain with lots of power behind it (in some sense this is the true magic of the blockchain — to maintain the ledger’s resistance to double spending without a fully centralized authority), but that happens to many smaller blockchains via 51% attacks.

Thanks for the book reco: that has been on my to-read list for a while. Hopefully I’ll get to it soon :)