Regulations are the good parts of regular finance. There are no financial regulations that currently harm me, a consumer.
We honestly need to return to a time when we had a bit more financial regulation.
We honestly need to return to a time when we had a bit more financial regulation.
All consumer banks have identical products, preventing you from starting things like a tontine/friends cash pool without a business behind it. KYC means you have to send in recordings of your face. Accredited investor rules often mean only rich people can get richer. There's definitely some harmful ones.
This is untrue in the US. Nothing is stopping you from contracting a tontine among friends. You just can't sell it to strangers.
> KYC means you have to send in recordings of your face.
This is untrue in the US too. Where do you have to do this?
> Accredited investor rules often mean only rich people can get richer.
I don't buy this. Most things that require accreditation are extremely risky.
The best asset classes (passive index funds) are available to everyone.
People of moderate net worth should avoid assets like venture equity like the plague.
What I mean is there isn't a feature where you can easily open a separate account and share it with them, or let them deposit to it, that doesn't involve separate money transmitter apps/doing your own accounting/being married to them or knowing their SSN.
Hmm, you could sell something like one under Reg CF as long as it's not an "investment company", I think? I've seen some weirdly structured unaccredited crowdfunds, there was one that sent me $200 of products for $250 equity investment, seemed like a good deal to me.
> This is untrue in the US too. Where do you have to do this?
That's how id.me works. Just using a picture of your passport doesn't provide a liveness check, though other places will just ask you more questions off your credit report instead.
> People of moderate net worth should avoid assets like venture equity like the plague.
Hopefully that lets rich people do it then, since they can easily have negative net worth (via loans against illiquid assets.) But accreditation has more than one way in, and not all of them are about assets - income or a stockbroker license are enough.
The math behind "risk" in MPT/Sharpe ratio based advice like you get from robo advisors is not that good though. It treats it like it's symmetric but downside risk of your early assets isn't that important (your income will replace them), its diversification doesn't help as much as it says (correlations go up in a down market), and once you have moderate savings you should be taking a lot more upside risk than it recommends.
Target date funds are the right answer for retirement funds but not for everything. Even if they were, the more uncorrelated alpha the better even in the MPT model.
$100m fines, chargebacks, compliance, transaction fees and the labor behind these are all fat that could be trimmed with DeFi.
> $100m fines, chargebacks, compliance, transaction fees and the labor behind these are all fat that could be trimmed with DeFi.
Yes, I know. These are the things I like about regular finance and don't want to give up. All of those things are pro-consumer except the transaction fees.
DeFi has not demonstrated an ability to eliminate transaction fees or even to make them predictable or consistently low! It's the worst of both worlds.
Mostly true if your main financial transactions are receiving bank deposits from your work & paying bills, and if you, your family and your friends all live in first-world countries.
I also own (and occasionally trade) securities, have loans (mortgage and auto), use credit cards, and own equity in private companies.
The only financial thing that I don't do is sell financial services, which is the industry that regulations were designed to reign in because they tend to be filled with grifters.
But you're correct, I am in the US.