Bitcoin itself won't, but the exchanges will; even when your coins are not on an exchange, addresses will be listed as suspect and watched closely if for example a hacked exchange's cryptocurrencies are transfered to it, basically freezing it. No exchange will touch it, and in extreme cases, the blockchain can be forked to undo a transaction.

> Bitcoin itself won't, but the exchanges will;

Sure, that's true, but you don't need the exchange to transfer value if you're using Bitcoin. Granted, you need them to get that value in your local currency and in cash (just like you need another Bank to transfer Paypal into cash).

> No exchange will touch it, and in extreme cases, the blockchain can be forked to undo a transaction.

How often has the fork happened though ... twice? three times? If we're getting into that kind of rareness, we'll lose all relevance. Banks sometimes outright steal from their customers, but it's so rare that I wouldn't put it up as an argument against using a bank.

As for receiving tainted coins: that's a more interesting point. Has anyone ever tried tainting large wallets by transferring known-bad coins to them?

That says you shouldn’t use PayPal, just as the billions locked or stolen by cryptocurrency exchanges says you should be careful about who you entrust with large amounts of money.

> That says you shouldn’t use PayPal

So you shouldn't use non-crypto convenient near-realtime payments? Stripe seems to have similar events regularly judging by the "Support HN" posts.

It's an issue that seems to arise from misaligned incentives, and regulators are looking the other way, as they do on many things in banking.

PayPal is one of company of many. If you want bad customer service, they've been delivering that for a couple of decades but that's a problem specific to them and there are better alternatives available.

It is definitely an area where regulation can help but the point is that you don't need to wait to give your business to someone else.

This is an argument for more regulation (of PayPal, and similar payment processors), not less, and certainly not for cryptocurrency.

Is more customer-friendly regulation of Paypal (they're a bank in Europe, you don't get more regulation than that) really something that is reasonably going to happen?

Lots of things would be vastly improved if only improbable things would happen (Google fights SEO-spam! Fusion brings unlimited energy too cheap to meter! Humanity unites in peace!), but would you place your bets on them happening instead of assuming the messed up reality we're in an dealing with it?