Hello, downsides of unregulated currency. Some of the rules are there for a reason.
Failure is a normal part of the market. What's really scary are the businesses that are never allowed to fail.
How many customers ("investors") would Mt. Gox have if that same regulation was applied to them?
People using Mt.Gox were not investing in Mt.Gox, they were investing in USD and BTC, and allowing Mt.Gox to hold it for them.
Well obviously. And it turns out the regulations are different too!
The need for regulations is what we are discussing here.
If MtGox were managing real money or stocks, and did what they are alleged to have done, I expect there would be some jail time. I doubt it's worth the Japanese government's time to criminally prosecute a few million dollars of new, unregulated currency-equivalent, but if they do prosecute, I'm guessing there is a serious risk of jail time here.
Bank deposit insurance is fascinating: it largely exists to prevent bank runs, which are caused by people believing they won't get their money out. Having any insurance means that people have less reason to believe there's a chance they won't get paid back, which decreases the probability of a run on the bank, which decreases the risk associated with the insurance, which decreases the amount of insurance needed.
But, yes, because it's pretty unlikely that all banks will fail at once, it's not necessary for the FDIC to have on hand a sum matching all insured US bank deposits.
There are also limits on coverage. If you keep $1 million in your savings account, you won't get all of it if the bank goes under.
Have you never heard of the SEC? There are all sorts of rules about what kinds of investors are allowed in a startup.
No, I want regulations for all other industries except my own. My industry is fine.
Edit: Looking at my list, I should have listed one for every alphabet Letter, instead of going chronologically.
[0]http://www.overstock.com/Books-Movies-Music-Games/The-Mis-Be...
Financial losses and windfalls / catastrophes happen far more frequently than you'd expect.
Also, my list is subject to dnautic's memory bias. Those are the names that I remember. There are certainly more. There is no currency in the history of the world that has lasted forever.
The cruzeiro was replaced by the "cruzeiro real" literally "real cruzeiro", as a hack to recover from poor fiscal policy resulting in hyperinflation. The cruzeiro real was then replaced by the 'real'.
Imagine things getting so bad that the government decides to rebrand its old currency as 'fake'.
It should be possible that one can blacklist their own bitcoin address by using the private key. This way at least crooks cannot make off or use the stolen coins. Do any more technical Bitcoin fanatics have any thoughts about this?
Second, AFAIK crooks need the private key to steal it, so wouldn't work anyway.
But what's the state good for anyway?
Make the corporation pay back every penny they got illegally, then hang the bastards high to set an example.