Technically this is possible on a blockchain. Optimistic rollups for example have a week-long dispute period.

It’s just that most people using blockchains haven’t needed or wanted this feature given its costs and centralization. Especially when transacting with smart contracts and digital assets: the domain asset you buy isn’t arriving damaged upon delivery.

If you really want this - it is not farfetched to assume a blockchain based PayPal replacement would offer some dispute resolution for special cases such as fraud, theft.

For bitcoin disputes are resolved by trusting the longest chain.

So I buy a product with bitcoin, and the seller never sends it or they send a fake version, how exactly does trusting the longest chain get the money back in my wallet?

This feature is almost the entire value proposition of PayPal.

That's not a dispute resolution with blockchain as it sounds like "it" is not on the blockchain. It would be treated as the same as cash. You would have to go and ask for a refund or sue them.

So bitcoin is not a replacement to PayPal then.

I agree in principle, but I stopped using paypal specifically because they stole my money on unfounded accusations and have done the same to tons of other people.

You misunderstand what "dispute resolution" means, at least in the context of someone proposing a blockchain as an alternative to PayPal.

Dispute resolution refers to a buyer and a seller who used the platform to transact a good having a dispute over the payment. PayPal can arbitrate such a dispute (in principle - your mileage will definitely vary) and either refund the payment to a defrauded buyer, or protect a seller from a buyer seeking to abuse the system.

Blockchains are entirely unable to help with this problem, as they are only a payment layer and have no information about things happening outside the blockchain itself, unlike PayPal.

>Blockchains are entirely unable to help with this problem

You can implement an escrow smart contract where a trusted third party controls when the money is released to the seller or refunded to the buyer.

Then that trusted third party is the one that can solve this problem. The blockchain itself can not.

In other words

“I sent 1BTC where is my car?”

“Lel weak hands!”

That's not a blockchain dispute as physical cars can not be on the blockchain.

In this cause it would be treated the same way as if you paid for the car with cash.

So in fact this is not a case for blockchain, as it's not solving any of the problems PayPal was created to solve (even if it doesn't have PayPal's problems either).