[mindcrime]

The thing is, it's one thing to have a legal system that can provide for redress and restitution in the case of actual fraud. It's quite another thing to have a legal system that prevents voluntary transactions simply because some of them might be fraud.

[amarkov]

The legal system can't reliably provide for redress and restitution in the case of actual fraud, because the legal system can't pull money from thin air. In something like a classical Ponzi scheme, the fraudster simply does not have enough assets to give everyone back what they're owed.