[zAy0LfpBZLC8mAC]

Well, I guess I phrased it badly, but I didn't mean a guarantee of returns, but rather just anything even suggesting it being an investment - that is to say, suggesting that it might possibly produce returns.

Madoff did not say "give me your money and you'll later get back the exact same amount, just minus some fees", I suppose? But that's what MtGox did - there was just no investment aspect to it.

[wpietri]

Plenty of people were buying Bitcoins because they thought they would increase in value, which sounds like an investment to me.

[zAy0LfpBZLC8mAC]

You are confusing the thing sold through MtGox with the thing sold by MtGox. MtGox sold the service of storing your money and of connecting you to trading partners and settling trades with those trading partners, that is what exchanges do - they didn't sell bitcoins.

It's like confusing eBay and paypal with some eBay seller: eBay and paypal don't sell clothes, say, they only help you find someone selling clothes and then (optionally) help with the settlement, the payment in particular.

And that's not just a formal distinction: On an exchange (like MtGox or any foreign currency exchange or stock exchange ...), the price for the traded commodity is not set by the exchange, but by the traders using the exchange. The exchange only sets the price for its service of connecting you with a counterparty, but the price for the stocks or bitcoins or whatever sold through the exchange is set by the trading partners, and the exchange also never takes on any of the investment risk, when you sell stocks, the counterparty gets the stocks, you get the money they paid, the exchange only does the bookkeeping.