Free market. Stop crying. This is what Bitcoiners want.
Conflict of interest happens even on traditional platforms.
However a decentralized exchange would solve this age old issue.
Phil G. Potter is a major stakeholder of Bitfinex and has administrative access to the backend platform including direct access to the database and is often present on a teamspeak voice channel where around 200 trader chat and share trading analysis.
Yesterday he was asked if he trades on his own platform Bitfinex, to which he replied yes. He was then grilled "don't you think that is a conflict of interests because you have special access to the platform?" - that is, he can see things normal traders cannot, like hidden orders, the size of everyone's accounts, the open margin positions of accounts, exact trading activity of each user, how much USD is flowing into and out of the exchange (he would have the competitive advantage of knowing when big players are feeling bullish). All of this gives a huge competitive advantage.
After this questions, he tried to back-pedal but made it worse by trying to justify it by saying because he is an early adopter (meaning he has a lot of coins and qualifies as a whale) he "only trades a little bit here and there".
Personally, I think it's disgusting. If he wants to trade ethically he should be trading on an exchange to which he doesn't have insider information and direct access to the database, or better still, don't trade. The revenue he makes from the exchange fees should be compensation enough.
Footnote: you can listen in to teamspeak on
http://vaughnlive.tv/whaleclub or connect using Teamspeak to desticraft.fr:9988
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