"If you get it wrong, there's no recourse. If you accidentally send some bitcoin to the wrong address, you are hosed."
Although this is true, the fact is that in practice this is rarely occurring. No system needs to be absolutely perfect to compete reasonably with the legacy financial banking system. As you point out yourself, the banking system has flaws, and yet it kind of works. Ditto for Bitcoin: it's not perfect, but it works quite well at solving certain real-world problems.
I think theft of Bitcoin private keys is a more serious problem than accidentally sending coins to the wrong address, however this is being solved by hardware wallets, N-of-M transactions, etc.
Mainly because wallet spoofing is not yet lucrative enough for hackers to put a lot of effort into it. If BTC really does start to get major traction, then it is only a matter of time before the web will be flooded with bitcoin wallet spam and phishing attacks.
Although this is true, the fact is that in practice this is rarely occurring. No system needs to be absolutely perfect to compete reasonably with the legacy financial banking system. As you point out yourself, the banking system has flaws, and yet it kind of works. Ditto for Bitcoin: it's not perfect, but it works quite well at solving certain real-world problems.
I think theft of Bitcoin private keys is a more serious problem than accidentally sending coins to the wrong address, however this is being solved by hardware wallets, N-of-M transactions, etc.
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