Yet TradeMe still exists and people use direct bank transfers than any other payment method on the site. If your claim (that business this way is not practical) was true then people would not use direct bank transfers. But they do. Ipso facto your claim can't be true.
My claim was and still is that using cash eliminates many of the scams - your claim was that scamming was too infrequent to matter. I provided evidence that it was frequent enough that the marketplace warned you against handing over money via bank transfers (other than their own special bank transfer that still had no guarantees). Please read those links I posted - they actually specifically warn against bank transfers.
I did read those links and they did not warn against bank transfers except overseas (and overseas transfers are quite different anyway - I can't simply entering an overseas bank account number in online banking to initiate a transfer as I can with domestic accounts). In fact both links are primarily concerned with phishing, not the sort of fraud we've been talking about. Obviously that is because the scamming you've been claiming is such an issue is not actually significant - it is phishing that catches people. My bank also warns me against phishing, yet they don't warn me against using direct transfers. What does that tell you?
If your claim is as minor as you're now saying, my response is "so what?" You might as well say that you can't be scammed in a transaction if you don't enter into private transactions at all. It's true, but it's irrelevant. Of course I concede that cash is less vulnerable to certain types of fraud than other payment methods. But the theoretically higher incidence of scamming with direct bank transfers is still so low that it doesn't matter. The fact remains that if scamming was as widespread as you make out then people would not use TradeMe or similar markets. Those markets exist, and are massive, ergo scamming is not the problem you think it is.
But the system still works. You haven't provided any evidence that it doesn't. You haven't even provided evidence that the incidence of fraud is higher with direct bank transfers.
I don't need to provide evidence that it doesn't work because I never made the claim that it does not work. I claimed that untrusted transactions are best with payment and possession taking place at the same time, hence cash works best for this. The sites you pointed me to warn specifically about doing bank transfers.
Cash doesn't work best for this because it is only practical for transactions in a limited geographic area. How far are you prepared to travel to gain this protection you rate so highly for a $20 transaction? $100? $1000?
Again, those links you provided do not warn against direct bank transfers. Did you actually read them?