Just read this analysis of the legality of Auroracoin and Bitcoin in Iceland by Dr. Peter Roudik of the Global Legal Research Center :
http://www.loc.gov/lawweb/servlet/lloc_news?disp3_l205404097_text If I am reading this right, Auroracoin is not recognized and cannot be used in payment of goods or services in Iceland. At all. It can't also be traded on exchanges based outside of Iceland or with non-Icelandic clients, since the Icelandic krona cannot leave the country (as per the Icelandic Foreign Exchange Act). I think the devs have very limited options with Auroracoin, and one wrong statement or move could see them breaking Icelandic laws.
So what is the end game, here? Surely this is all not a matter of speculation?
Very good question - and I asked in the skype group to Pétur-Hermann-Hlynur from the Fondation (each time it remind me Isaac Asimov):
[19:46:26] Hermann Finnbjörnsson: we sent 3 formal letters from our laywer to all goverment agencies here that handle finace about the exhange and everybody replied in the same mater "The existing laws do not provide for potential involvement of The Central Bank of Iceland, the operations of the kind described in your inquiry"
[19:47:11] Hermann Finnbjörnsson: we have the letters and would not be doing what we are doing without the knowledge we could proceed
[20:33:48] Hlynur Þór Björnsson: We sent formal letters to the Central Bank and the Financial Supervisory Authority in Iceland. Both sent us replies warning of the risk of crypto but saying there are no laws that perhibit doing business in crypto. The FSA also confirmed that we don't need a money transmitter license for an exchange or for buying and selling crypto for customers.