Not sure if it is a plus or a minus. There is a lot of room for competition, but if they are guilty of something bad enough, maybe it is good that they are stopped? Bitcoin and all the other alternative currencies put together are still a very very small fraction of the marketplace.
But even if they are being stopped for cause, there are innocent people whose funds are now frozen. Should I be punished just because my neighbor does something bad?
Right, that was basically my point, you shouldn't. But it is a part of the counter-party risk of using any institution. Closing the shop peremptorily strikes me as a misplay of the interests of justice, unless the authority was being stonewalled and had no other choice.
Once the authority gets evidence, they can either go for the selective fire, or the carpet bombing, but the selective fire typically will take the compliance of the leadership of the organization.
Once they get stonewalled, they have fewer choices.
This is complicated by the forfeiture laws, which can give seized wealth to the prosecuting authorities organization and lead to big career advancements for the government employees who capture it. The forfeiture laws lead to much sloppy law enforcement.
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