Quote from: AyeYo on July 11, 2011, 01:59:55 AM

Quote from: Confucius on July 10, 2011, 10:31:21 PM

Finally, you can't have expectations of entrepreneurs in a new market to have bureaucratic certifications and be following non-existent regulations.

How do you propose an exchange should be set up for the Bitcoin market?

I aboslutely can, because every other legitimate start up business does it. If the new pizza place down the road from me can begin business in full complance with the law, so can a Bitcoin exchange. They can collect the proper information from traders, just like a real exchange. They can submit to regulatory bodies and follow all national laws (using an off-shore bsaed currency trading account is NOT legal for US citizens, for starters). You know, all that good stuff that every other legit brokerage and exchange goes through. Real businesses that people plan on sustaining and growing dot all their i's and cross all their t's FIRST. No one just wings and hopes for the best, unless it's because they plan to be a fly by night scam shop.

MtGox is processing millions of dollars per day, but the website looks like it was made by a five year old, they have no real contact information, they aren't a registered business, they are not in compliance with local or international laws (have fun when your funds are seized and never returned), and there's absolutely zero transparency.

Valid Points.
However, Mt Gox is not the only exchange in existence - point being that people who outweigh benefits over risk of using said exchange, will make do with the time being, and adopt when appropriate.
A pizza place is well established market segment, but Bitcoins are a grey area with Zero, 0, Null, bureaucratic regulations and certifications, in relation to Bitcoin oriented businesses.
Which (current) regulatory body will acknowledge a business that exchanges fiat monies for BTC as a legit exchange?
It is true that they can still be in compliance with all laws, on the other hand, they may have their own agenda for not doing so.

Laws are there to protect you, can you not protect yourself?
You may think this is a bold statement, but it is entirely possible for sensitive activity to occur between trusted parties, without regards to law. I can buy dope from my friend safely and easily even though it illegal.
How does this apply? People who take the time to evaluate the risk, examine their own trust towards who they are trading.
Some, like yourself, who wish for all the walls and thorns to be up already will have to wait for slow bureaucracy to catch up. Others enjoy a web of trust.

Some do wing it and hope for the best. Either way, Mt Gox is not the only exchange, the majority have chosen to use that one, even if its sheep mentality, ignorance to risks, or whatever. It is the reality and to comprehend it you will not succeed by putting forward proposals why it shouldn't be that way.

If you expect for there to be a safety net, you have the up most right. However, you will have to wait for an exchange that wants to be in full compliance with the law, and slow bureaucracy to catch up.
Look for another exchange such as Tradehill, and find out if they are violating some law. If you find they are, why? Surely they have their own reasons, same with Mt Gox. You may conclude scamming but maybe its protection from conflicting laws etc. If there are no good reasons why an exchange might be avoiding certain laws, I'm sure their will be entrepreneurs to start new exchanges that do.

There is definitely room for improvement for a lot of aspects of the exchanges, however that will come with time.

I'm not going to argue if they can do it better, that will be solved by competition.
I was simply stating they can't follow non-existent regulations and certifications in regards to a Bitcoin oriented business.

Also, if its so illegal, why hasn't it been shutdown?