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Laws and regulations are intended to create a greater good. Sometimes we have to stifle a few exceptional people for the good of everyone else. Preventing smal

Laws and regulations are intended to create a greater good. Sometimes we have to stifle a few exceptional people for the good of everyone else. Preventing small time retail investors from buying into high risk startups is a good thing. Unfortunately the general public has proven over and over again that they lack the financial sophistication to comprehend the difference between a scam and an investment opportunity. Remember even VCs lose money on a vast majority of deals. The ICO mania over the last year provided an excellent reminder of why these regulations exist and why they are important.

chrisco255 8y ago
No the ICO mania just underscored a point: people want access to capital markets. They're so hungry for it that they're willing to accept tokens backed by nothing. If companies could issue security tokens without excessive regulatory burden they would do so, and we could use classical evaluation models for arriving at fair market value for said tokens.
- pembrook 8y ago
  I think you just proved my point. These people were so enticed by the idea of “getting rich quick” that they bought worthless tokens that gave them ownership rights to nothing. Since they lack the sophistication to understand they were being scammed...why do you think they would have any understanding of classical valuation models?
  - chrisco255 8y ago
    Nobody understands cryptocurrency valuation, this is a brand new asset class. Whereas, stock investing is pretty mature at this point. People bought and flipped real estate in the 00's in a bull market only to see it all crash in 2008. Bubbles happen. Doesn't mean you cut out everyone who doesn't have $1 million in the bank. That's like only letting skinny people eat healthy food.
catcow 8y ago
I find your comment offensive. This is a condescending attitude that keeps people outside the financial class on the fringe and destroys their ability to take control of their lives. If you treat people like children they will forever remain children. As a struggling low-income millennial, FATCA and accredited investor requirements have easily set me back a decade.
- mrep 8y ago
  > As a struggling low-income millennial, FATCA and accredited investor requirements have easily set me back a decade. How? Are you wanting to be one of the scammers because those are practically the only people that would get rich if we got rid of these laws? Almost everyone would make less returns than an index fund and a lot would even lose more money to the scams than they would make from the good investments. There would be a few outliers who just got plain lucky but if you want to be one those people, just play the lotto or go to vegas where your odds would be better.
  - catcow 8y ago
    I'm not trying to get rich. I'm just trying to survive. Making money in finance is not about luck. It takes hard, consistent, painstaking work. I have a serious disability that is not recognized as such by the government. No one will hire me. I am completely isolated from civil society. The only way I can make money and pay for my medical expenses is to start my own businesses. I can only start businesses in unregulated markets because the barrier to entry is impossibly high elsewhere. Without Uber/Lyft or cryptocurrency I would probably be dead. Like seriously not alive. Gone. Not existing anymore as a human. So when people whine about how they've been scammed because they made ignorant decisions and got involved with things that they shouldn't have, I do not feel sorry for them. They got greedy, gambled, and lost. That's on them. I am not gambling. I am making legitimate transactions with people who need my services. Just because some people scam does not mean that I am. What has happened to me just happened through no choice of my own, and it feels like regulators are doing everything they can to keep me down, all in the name of protecting people who refuse to put in the work to make wise decisions. People who have more than me. People who are healthier than me.
mancerayder 8y ago
Preventing small time retail investors from buying into high risk startups is a good thing. Unfortunately the general public has proven over and over again that they lack the financial sophistication to comprehend the difference between a scam and an investment opportunity. Remember even VCs lose money on a vast majority of deals. That's an extremely elitist, if utilitarian perspective. It doesn't make it wrong. However, consider that having a lot of wealth as a pre-req for obtaining wealth is, of course a circular problem. It's a legalized entrenchment of wealth sort of situation and the justification is, the public good.
- mrep 8y ago
  > However, consider that having a lot of wealth as a pre-req for obtaining wealth is, of course a circular problem. No it's not, there are plenty of rags to riches stories (they had to get their wealth in the first place and most wealthy people didn't just stumble upon oil). On the point of unregulated securities, if you are so interested in investing in them, why don't you just join a VC? Once you make partner, you get your share in the returns and can make a lot more money since you will have way more capitol to invest than the spare change you have in your bank account.
  - deleted 8y ago
    [deleted]
  - mancerayder 8y ago
    You're saying that the answer to the problem of inherent advantages in the game of wealth creation -- which boils down to existing wealth generating much more much faster than far less wealth -- is to 'join a VC'? It's difficult to tell if you're being moralizing or humorous. The question we're chewing over is, does accreditation requirements help or hurt the ability for individuals to ascend economically. It obviously hurts them and the other side of the coin is that it reduces a wider fallout should things go wrong. Which part is controversial?
    - mrep 8y ago
      > which boils down to existing wealth generating much more much faster than far less wealth No, generating wealth from wealth is proportional to your wealth. A middle class persons wealth in the sp 500 generates the same percentage returns as that of a billionaires does. > join a VC If you really think you can beat the market, then you should join the VCs and you can make a bunch of money IF YOU ACTUALLY CAN ACTUALLY BEAT THE MARKET. However, I HIGHLY doubt you actually can because most people do not and yet there are tons of people like you that think they can especially the most uneducated which is why they are the most susceptible to scams and why we have laws to try and product them because having an economy based on scams has lots of negative externalities. > does accreditation requirements help or hurt the ability for individuals to ascend economically. It obviously hurts them Explain?

chrisco255 8y ago

No the ICO mania just underscored a point: people want access to capital markets. They're so hungry for it that they're willing to accept tokens backed by nothing. If companies could issue security tokens without excessive regulatory burden they would do so, and we could use classical evaluation models for arriving at fair market value for said tokens.

pembrook 8y ago
I think you just proved my point. These people were so enticed by the idea of “getting rich quick” that they bought worthless tokens that gave them ownership rights to nothing. Since they lack the sophistication to understand they were being scammed...why do you think they would have any understanding of classical valuation models?
- chrisco255 8y ago
  Nobody understands cryptocurrency valuation, this is a brand new asset class. Whereas, stock investing is pretty mature at this point. People bought and flipped real estate in the 00's in a bull market only to see it all crash in 2008. Bubbles happen. Doesn't mean you cut out everyone who doesn't have $1 million in the bank. That's like only letting skinny people eat healthy food.

catcow 8y ago

I find your comment offensive. This is a condescending attitude that keeps people outside the financial class on the fringe and destroys their ability to take control of their lives. If you treat people like children they will forever remain children. As a struggling low-income millennial, FATCA and accredited investor requirements have easily set me back a decade.

mrep 8y ago
> As a struggling low-income millennial, FATCA and accredited investor requirements have easily set me back a decade. How? Are you wanting to be one of the scammers because those are practically the only people that would get rich if we got rid of these laws? Almost everyone would make less returns than an index fund and a lot would even lose more money to the scams than they would make from the good investments. There would be a few outliers who just got plain lucky but if you want to be one those people, just play the lotto or go to vegas where your odds would be better.
- catcow 8y ago
  I'm not trying to get rich. I'm just trying to survive. Making money in finance is not about luck. It takes hard, consistent, painstaking work. I have a serious disability that is not recognized as such by the government. No one will hire me. I am completely isolated from civil society. The only way I can make money and pay for my medical expenses is to start my own businesses. I can only start businesses in unregulated markets because the barrier to entry is impossibly high elsewhere. Without Uber/Lyft or cryptocurrency I would probably be dead. Like seriously not alive. Gone. Not existing anymore as a human. So when people whine about how they've been scammed because they made ignorant decisions and got involved with things that they shouldn't have, I do not feel sorry for them. They got greedy, gambled, and lost. That's on them. I am not gambling. I am making legitimate transactions with people who need my services. Just because some people scam does not mean that I am. What has happened to me just happened through no choice of my own, and it feels like regulators are doing everything they can to keep me down, all in the name of protecting people who refuse to put in the work to make wise decisions. People who have more than me. People who are healthier than me.

mancerayder 8y ago

Preventing small time retail investors from buying into high risk startups is a good thing. Unfortunately the general public has proven over and over again that they lack the financial sophistication to comprehend the difference between a scam and an investment opportunity. Remember even VCs lose money on a vast majority of deals. That's an extremely elitist, if utilitarian perspective. It doesn't make it wrong. However, consider that having a lot of wealth as a pre-req for obtaining wealth is, of course a circular problem. It's a legalized entrenchment of wealth sort of situation and the justification is, the public good.

mrep 8y ago
> However, consider that having a lot of wealth as a pre-req for obtaining wealth is, of course a circular problem. No it's not, there are plenty of rags to riches stories (they had to get their wealth in the first place and most wealthy people didn't just stumble upon oil). On the point of unregulated securities, if you are so interested in investing in them, why don't you just join a VC? Once you make partner, you get your share in the returns and can make a lot more money since you will have way more capitol to invest than the spare change you have in your bank account.
- deleted 8y ago
  [deleted]
- mancerayder 8y ago
  You're saying that the answer to the problem of inherent advantages in the game of wealth creation -- which boils down to existing wealth generating much more much faster than far less wealth -- is to 'join a VC'? It's difficult to tell if you're being moralizing or humorous. The question we're chewing over is, does accreditation requirements help or hurt the ability for individuals to ascend economically. It obviously hurts them and the other side of the coin is that it reduces a wider fallout should things go wrong. Which part is controversial?
  - mrep 8y ago
    > which boils down to existing wealth generating much more much faster than far less wealth No, generating wealth from wealth is proportional to your wealth. A middle class persons wealth in the sp 500 generates the same percentage returns as that of a billionaires does. > join a VC If you really think you can beat the market, then you should join the VCs and you can make a bunch of money IF YOU ACTUALLY CAN ACTUALLY BEAT THE MARKET. However, I HIGHLY doubt you actually can because most people do not and yet there are tons of people like you that think they can especially the most uneducated which is why they are the most susceptible to scams and why we have laws to try and product them because having an economy based on scams has lots of negative externalities. > does accreditation requirements help or hurt the ability for individuals to ascend economically. It obviously hurts them Explain?