sign wallet that M and B can access?
If Person B has to signing anything, I'd worry about UX. A password makes sense to keep.
True—password is simpler. A fiat M, M crypto X, X fiat B
I think the benefit of hawala is that Person A would get his original fiat back from Provider M if it fell through, so instead of just trusting that Provider M will hold on to it (until it's verified that Person B received the fiat on the other side) Person A will get BCH instead so they are insured against Provider M.
In my model, crypto becomes the insurance. This reduces or potentially eliminates the trust component
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