[pjc50]

Those are designed to prevent people from getting scammed, after numerous incidents. Because the absolute best "mark" is someone who thinks he's a sophisticated investor because he's watched some videos on youtube. People like to cite "higher returns" but only after conveniently ignoring all the ones that didn't pan out.

Also, leverage: if you're borrowing money to make an unsecured investment in a scheme, disaster awaits.

[tathougies]

> People like to cite "higher returns" but only after conveniently ignoring all the ones that didn't pan out.

The United States allows 'microfinancing' via kickstarter, where poor people are allowed to give money to new ventures without any expectation of return on the given capital. Meanwhile, the rich get the opportunity to invest for actual returns on capital. Do you think an accredited investor is going to give money on kickstarter when they could offer cash as an investment?

So why is giving money allowed, but spending the same money on acquiring shares not? The answer that 'some people got scammed' does not excuse the fact that people are still allowed to spend the same money today, without consumer protections, while not receiving any benefit. In other words, we have created yet another way to privatize the benefits of new ventures (by only allowing rich people to profit off of them) while socializing the costs (the people asked to contribute to new ventures without any ownership interests via microfinancing platforms). The response that this is for consumer protection is crap, and anyone not blinded by legal confirmation bias can see that

Maximal investment limits based on income are perhaps appropriate, but wholesale banning is morally reprehensible, and a direct contributor to income inequality.