Quote from: Severian on October 04, 2012, 09:17:01 PM

Quote from: LoupGaroux on October 04, 2012, 06:56:38 PM

GLBSE is a scam.

Indeed. I'm not surprised.

I also see them as yet another stepping stone for the education of the Bitcoin community. As much as I love the idea of Bitcoin (so much so that I'm heavily vested in it) and the drive of the community, I have to remember that the young, inexperienced community is Bitcoin's biggest liability.

Honestly, it's about time that wannabe entrepreneurs started to realise that you can't just do whatever you want within the business environment and claim some kind of magical immunity because...Bitcoins. I hope the events of the last couple of months do have some kind of chilling effect on start-ups so that we see a much more professional approach to the launching of Bitcoin services in the future.

Very, very few existing Bitcoin services have the kind of financial reserves necessary to weather regulatory or other legal challenges and that needs to change. One of the first questions we should be asking those launching services in the future is what their contingency plans are for predictable challenges such as bank accounts being frozen, their service being hacked, regulatory requirements being imposed, etc.

PayPal spent years trying to avoid being regulated and it ended up losing the fight despite having the enormous financial reserves of e-Bay at its disposal. Facebook abandoned FB credits - which were projected to be a huge source of revenue - in order to avoid potentially expensive legal complications. I doubt that even the most successful Bitcoin services can afford protracted legal challenges lasting years and costing hundreds of thousands of dollars. Services need to be far more upfront about what their plans are for dealing with legal and regulatory issues which will almost certainly arise more often as time goes on. For many services, the honest answer is that they will simply have to close if they come under regulatory or other legal scrutiny - it's about time users were explicitly made aware of that likelihood.