There are lots of stock exchanges which offer alternative algorithms for order-matching. It's up to each individual company which primary exchange it chooses to

There are lots of stock exchanges which offer alternative algorithms for order-matching. It's up to each individual company which primary exchange it chooses to be listed on (although obviously it can't stop interested parties creating a secondary exchange using whatever rules they want between them). Some exchanges specifically prohibit the practice of flashing while others don't. It's a free-market, if people and companies want to trade on exchanges with alternative matching algorithms and prohibitions on flashing, there's nothing stopping them from doing it. Exchanges are only as valuable as the people who trade on them, if the traders want another set of rules than the exchanges have to adapt otherwise the traders will go elsewhere.