Digital currency exchanger
From Wikipedia, the free encyclopedia
Digital currency exchangers (DCEs, independent exchange providers or e-currency exchangers) are market makers which exchange fiat currency for electronic money, such as digital gold currency (DGC), and/or convert one type of digital currency (DC) into another, such as Liberty Reserve into pecunix. Exchangers apply either a commission or bid/offer spread to transactions.
Some digital gold currency accounts, such as e-gold, do not provide an in-house service to purchase their private currency so it is necessary to use a third-party digital currency exchanger. According to e-gold's website the reason they do not provide an in-house exchange service is so there can be no debt or contingent liabilities associated with the business, making e-gold Ltd. absolutely free of any financial risk. They claim e-gold Ltd. does not possess currency of any nation or even have a bank account.
There are no specific financial regulations governing DCEs, so they operate under self-regulation. However the Global Digital Currency Association (GDCA), founded in 2002, are a non-profit association of online currency operators, exchangers, merchants and users. On their website they claim their goal is to "further the interests of the industry as a whole and help with fighting fraud and other illegal activities, arbitrate disputes and act as escrow agent when and where required."  GDCA is a privately owned organization and not an association of its members per se. Its views and opinions are highly subjective. It is completely irrelevant whether or not any of the exchange companies are members of GDCA.
It is possible for clients to purchase DGC by credit card, and therefore receive consumer protection from their credit card company. Various exchangers offer this service, although the exchange fees are typically higher than using a wire transfer. 
Comparison of Digital Currency Exchangers (DCEs) as of 18 April 2010:
|Digital Currency Exchanger||Year|
currencies (DC) accepted
|Fiat currencies accepted||Fee buying DC||Fee selling DC||Fee exchanging DC to DC|
|Money Central Market||2007||2||3||2.99%-4.99%||4.99%-6.99%||0–5%|
|Euro Gold Sales||2004||2||3||2.5%–4%%||1.9%||N/A|
In September 2004 several Australian based e-gold currency exchangers voluntarily ceased operation as they did not hold an Australian Financial Services licence (AFSL) . Australian based DCEs that elected to close, due to theAustralian Securities and Investments Commission (ASIC) licencing requirements, included:
In July 2006 Gold Age was closed down by US government authorities following the arrest of the owners, Arthur Budovsky and Vladimir Kats, on account of not having a New York state "money transmitters" licence.
In April 2007, the US government ordered e-gold administration to lock/block approximately 58 e-gold accounts, owned and used by The Bullion Exchange, AnyGoldNow, IceGold, GitGold, The Denver Gold Exchange, GoldPouch Express, 1MDC (a Digital Gold Currency, based on e-gold), and others, and forced G&SR (owner of OmniPay) to liquidate the seized assets . In addition, a few weeks later, e-gold themselves were indicted with 4 indictments. However, e-gold are still in business, and are growing at the rate of approximately 95,000 new accounts per month . Here is the DoJ release  and here is the rebuttal by Douglas Jackson, CEO [dead link](archive.org copy).
In July 2008, Webmoney changed its rules, that affected many exchangers. Since that time it became prohibited to exchange Webmoney to most popular e-currencies like e-Gold, Liberty Reserve and others:https://newsblog.wmtransfer.com/asp/messages.asp?date=2008-7-23&blogID=6