[notahacker]

It's disingenuous in the extreme to suggest that AML/KYC policies and banking regulations have anything to do with a significant proportion of all Bitcoins ever in circulation having disappeared from counterparties claiming they were hacked. Real, regulated banks do not simply lose significant fractions of dollars in circulation.

It has a lot more to do with bad code, bad storage policies or bad intentions on the part of the exchanges, and most of them point to transaction malleability - a design flaw in the original protocol - as their excuse.

[dcc1]

The steep barriers to entry into becoming an exchange due to these laws/policies and the whole cloudy and non clear nature of what protocols to adhere in each country ensure that exchanges are not started by the most competent but by the most reckless and foolish, see magic the gathering.

There are several exchanges in the works but they are bogged down with regulation and not able to open.

[danielahn]

So... you're saying its easy for the reckless and foolish to somehow overcome these steep barriers and understand what it takes to open while those who are competent are unable to do so?

[nhaehnle]

He's saying that those who understand what it takes to build a secure service see the problem as so difficult that they prefer to use their talents for something else. As a consequence, the services that do exist have been built by reckless people who don't understand the issue.

I don't know whether that's true, but that's what s/he wrote. It's an easy enough to understand and plausible notion.

[dcc1]

You obviously never had to deal with bureaucrats, right now the 2nd biggest exchange BTC-e is runny by some shady eastern europeans who are simply ignoring all laws. The biggest exchange Mtgox was run by an incompetent fool who lost half a billion in the cushion of his couch or something.

Bitstamp seem to be doing the right things but I doubt that they can legally operate in US or take transfers from/to US as they are doing.