It's unfortunate that many people lost money (and some might have lost a lot), but if the ecosystem can recover from this without governmental regulation (as I expect it will), we have the first evidence (ever) that there is no need for a central authority to conduct oversight and ensure a robust currency.

It looks likely that the free market, which includes the self-regulating actions by Coinbase, Blockchain and others (as well as customer reactions), will punish the bad actors and reward "good" (well managed) companies. It will also create better consumers, who will now be more diligent in evaluating relevant services before they sign up.

You write that you'll be staying away for now, that is your right as a potential participant in the market. We are already seeing the major players (like Coinbase) react to your sentiment by increasing transparency to bolster confidence in their services.

1. This is what we want. 2. When have you seen the existing financial system react so rapidly and thoroughly to the many flaws and disasters incumbent within?

Yes, "a little regulation and oversight might have prevented all this", but it also might have prevented crypto currency from being able to prove its value (or fail to) in the free market.