Who said it was simple? MtGox isn't #1 because of the quality of their site/engine. It's liquidity. It's a chicken/egg argument. There are plenty of market leaders who are poorly run. They remain market leaders for a number of reasons. You have this naive business paradigm that the biggest site is clearly the best, clearly well run, otherwise they wouldn't be number #1! Sadly in the real world, where real people live, that's not always true.
They are still there, while plenty of others were taken down by hacks, regulations, or plain arbitrary decisions from banks.
They are also located outside of USA. Which, in my book, is an advantage.
Does liquidity play in their favor? Sure.
However, I would argue that this is only a small advantage.
Another exchange, with the same characteristics as MtGox (except the liquidity), could probably
take a good chunk of the market by offering smaller fees.
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