Our startup's office used to be next door to what is affectionately called a "boiler room". These guys would essentially prey on old people and other vulnerable folks with various schemes related to penny stocks. And we'd hear the stories through the walls in this crappy office, in the elevators, etc. And it generally consisted of someone losing money (the client) and the boiler room scumbags making money.

And so while I'm all for free markets (my own startup's business is sort of predicated on it) and I do think that changes to the SEC rules should be made, I do worry about making this open season because the scumbags out there will find a way to take advantage of the opportunity quickly and at scale. That is what unscrupulous folks do, and they do it well.

Also, when it comes to tech investments in particular, even Fred Wilson says the best VCs bat .300 and the legends bat .400. That means many of the pros also bat .100. I don't know how Joe Public is going to be able to do this well when the professionals cannot.

Sure, we can say the SEC needs to regulate to ensure this doesn't happen, but as evidenced by our last crisis, that wasn't possible to do for multi-billion dollar organizations. I'm not sure they'll be able to do much for Aunt Sally who lost $10k on the Quora for Pets that she was convinced would be huge by some smooth talking cat with a slick PowerPoint.

This comment may go against the ethos of HN (and result in lots of downvotes), but I think there are some downsides if they go too far in opening up the market.