Only thing saving Western Union is the archaic laws. I don't see those going away soon, so they are safe for now.
Correct. Ask all transmitters to have huge documentation requirements and KYC norms. A start up company using bitcoin would be hard pressed to ensure compliance.
I don't know what kind of clauses they make the end points sign, but in principle they can accept Bitcoin along with their normal operations. This is assuming that the laws are Bitcoin friendly at their end.
I guess the end points convert bitcoins back to fiat. And once you do that, you have a money trail and the usual Know Your Customer / Anti-Money Laundering requirements.
