I think the issue with these regulations is that they use net worth as a proxy for an investor's qualifications. I'm not convinced that this is a good proxy. A

I think the issue with these regulations is that they use net worth as a proxy for an investor's qualifications. I'm not convinced that this is a good proxy. Any grandma or grandpa who's been putting a decent amount from each paycheck into US equities for 50 years is going to be very wealthy today - but is probably not truly a "sophisticated investor". They're a prime target to get ripped off. By contrast, a bright young software engineer a few years ago who picked up early on Airbnb or Uber could potentially be a "sophisticated investor", but would be excluded because of his or her net worth. I really am not sure what an ideal proxy would be. I used "grandma/grandpa" and "bright young software engineer" in my example, but I don't think age or occupation would be good proxies either. Perhaps some sort of investor qualification exam? Regardless, the completely-unregulated ICO market is a separate issue from private equity more generally. We should be careful conflating the two.