I've already made some comments on my views on this, but I think this whole affair is a symptom of a greater problem.  We have a functioning medium of exchange that is roughly (very roughly) equivalent to digital cash, backed only by market pressures and community interest, and the problems are cropping up at the interface between this and the highly regulated world of national currencies.  Try to walk into a bank with 45k in 100 dollar bills and exchange them for euros and see how they look at you.  The future of bitcoin is clearly dependant on the availability of direct peer to peer exchange of currency, rather than some sort of central exchange point.  I'm going to look into bitcoin otc now, this thread has taught me a lesson.   The primary problem with only doing peer to peer exchanges is the ability to create a false persona when you get caught scamming, this problem was solved with cryptographic signatures decades ago. I'm thinking of a system in which a market is created where you can buy and sell bitcoins for any currency, any payment method, peer to peer, and your identity is attached to a gpg key generated for this purpose, and kept on your own computer.  Each time a transaction goes through another member of the community can sign this key.  The obvious flaw here is that I could make a hundred identities and sign my own keys.  I think if scammers could be identified with a sort of negative signature, that would show up as a demerit against their credit rating this might be held in check.  Any thoughts of a better implementation of some sort of scheme like this?