And from history of 'classic' banking we know very well that the 'lost reputation' doesn't work - we've tried that all over the world in the earlier times, it resulted in people creating new 'fresh clean reputation' companies one after another and sucessfully repeating such things over and over.
Raising the barrier of entry is the whole point - if you're unable to meet your agreements, you should be kept far, far away from that business permanently.
I personally think that no-regulation will lead to implosion, as the bad reputation of a few firms quickly turns into a bad reputation for the currency, defacto scuttling the project as consumers learn not which bitcoin companies are untrustworthy, but that the whole system is untrustworthy by design.
You're right that some Bitcoin companies have screwed their users. Consumers need to educate themselves on who they're doing business with. A lot of these Bitcoin companies operated anonymously without impunity. Coinbase is an entirely different case. They are a US based company with VC backing. You know who you are conducting business with.
If you as a consumer want to purchase something from a company that isn't transparent, you don't know where their located, and don't know who's behind the operation, it doesn't matter whether you send bitcoins or your credit card number. It's still stupid. Common sense must prevail somewhere.
Your examples are unbelievably silly, as both Enron and the financial crisis of 2008 occurred in the context of deregulation of those "traditional markets".
Wanna watch Bitcoin absolutely implode and die? You libertarians keep up your adolescent, blind fervor for nonregulation.
One of the major problems at Enron was deregulation specifically. You need to a do a little more research to bolster your regulation = bad for bitcoin argument.
I will never, in my life, understand why so many Libertarians take the argument that if some criminal might engage in a crime, then everyone should be allowed to do that same thing. It's the stupidest argument possible, yet you all parrot it unquestioningly. It blows my mind.
I never held the position that you stated.
Your writing clearly implied that regulation is useless because sometimes criminals evade regulation. If you were capable of understanding how communication works, you'd admit this.
Further, I encourage you to learn how not to be a jerk. because you are one, and it undermines any value that you might have, by ensuring that no sane person (who disagrees with you on you on any point) will ever want to have a discussion with you. That said, I can see where an ignorant jerk like yourself might consider it a feature that only people who agree with you completely are capable of having a conversation with you.
My point was that I don't think that regulation is the answer. I honed in on the idea that regulation has failed in the past (I have more research to do here) and thus, maybe alternatives should be considered. I wasn't trying to imply that because laws don't prevent criminals, that we should not have laws. Obviously, that's ludicrous. It's ludicrous because regulation != laws, or the principle of having laws. I think we can safely say that regulation may be an implementation of a law, or a specific law. Much like pizza is food, but not all food is pizza. Follow me so far? So, philosophically, if we have a bad set of laws, I wasn't suggesting that we throw out all laws, I was suggesting that we look for alternatives to the bad set of laws. To bring it home a bit more to other areas in modern society, it'd be like if I said that I think the war on drugs is failure, "tell me how the war on drugs has helped stopped drug abusers and criminals" and then you were to respond with your same response of "And laws against theft don't prevent all theft so theft should be legal." when that clearly wasn't my position.
Does this clear up my position a bit? Anyways, sorry I came off as a jerk.
Don't act like the only way this can be "fixed" is by inserting government control over the situation.
Ah, Libertopia! It's almost upon us, Comrades!
The stupid libertarians get their stupid pie-in-the-sky currency and you get to sit back with a bowl of popcorn (purchased with a government-secured currency of your choice) and enjoy the show.
The whole point that libertarians fail to realize -- and one of the most basic and obvious lessons of thousands of years of recorded human history is that one way or another, we're all stuck on this same, leaking boat together. And we're just going to have to find a way to cooperate on some basic level.
Else things start to get really inefficient and wasteful -- or potentially really, really ugly and violent -- really, really fast.
See also:
It's what happens if you smoke weed and it what happened if you were gay until very few years ago. It's what happens if you're really annoying on Twitter in the UK.
But the golden irony is that you follow up with an analogy about the greatness of coercive government. Leaking boat? Cooperation? Sounds great, clearly that's why we need to throw Aaron Swartz in jail for 35 years.
I'm not convinced that no government is the right size, but the current scope of government across the western world has an immense moral authority problem. We may well be on a leaking boat, but it seems clear to me that the life raft isn't going to save us.
That's great for all the people who watch and learn that Company A will steal your money, but not so great for the people who provided that evidence for everyone else.
In this paradigm, where anonymity is rampant, reputation is just a word. As an anonymous entity/non-entity has no consequences to their actions.
Except for the missing piece of the puzzle: worthy competitors. Very few people who would otherwise run great businesses to compete with Coinbase don't want to operate in this sector because of the ridiculously onerous criminal laws that now surround money transmitters and exchanges.
As just one example of these laws, to operate in this sector, you have to agree to be a government informant against your own customers, even if you think they're not doing anything wrong.