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Comment by jongjong | Hacker News Reader

I can understand the wash trading aspect being a crime; it deceives investors which is akin to lying about the asset but I can't bring myself to accept 'selling unregistered securities' as a crime... Especially given that registering a security can cost $60K+ - That's simply not a fee which most small projects can afford; it's effectively locking entrepreneurs out of opportunities in a way which is against fundamental free market principles. Surely it's unconstitutional.

If the seller is honest about the asset which the investor is buying, I don't see how the government should have anything to do with that. If the investor is not capable of understanding an accurate and concise description of the asset, then that's the investor's fault; the government should not protect people from their own negligence or ignorance - The system relies on keeping capital in the hands of intelligent, knowledgeable people; this is the foundation of a functioning system.

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> Especially given that registering a security can cost $60K+ - That's simply not a fee which most small projects can afford; it's effectively locking entrepreneurs out of opportunities in a way which is against fundamental free market principles

They can't sell unregistered securities to the general public. They can sell them to "qualified investors" [1] or to their own board members and executives. That should give enough opportunities to small projects that are actually doing something that will be successful.

[1] https://www.investopedia.com/ask/answers/08/unregistered-sec...

It misses the entire point of crypto. It's for entrepreneurs who have been shunned by traditional investors; who have been locked out of the mainstream funding monolith.

Big investors and VCs consistently refused to fund my startup, they refuse to talk to me. I'm nothing to them. I don't have access to that funding like some other people have. Maybe I've been blacklisted for no reason. Either way, given my excellent publicly-proven track record, I deserve an opportunity to compete in the free market just like you do.

You don't seem to understand the adversity some people are facing and how unjust and broken the system is fundamentally. It's physically impossible for me to raise funding from traditional VCs and angel investors for reasons that are both unknown to me and outside of my control. My few interactions with investors are downright weird now. It's like the whole system has conclusively locked me out and then gaslights me about it 24/7. Crypto and regular investors are my only chance.

Until you've been in this position, you can't understand. You're missing a critical piece of experience.

Now when I hear about the 'unbanked' in Africa, I hear it very differently. I can at least start to wrap my head around the incredible hardship it represents. In my case I'm not unbanked but I'm 'uninvested'; it's just one class above.

What exactly is unjust about people not wanting to give you their money?

Get a job. Seriously.

I did, but it's not sustainable. Typically, I'm good for 6 months and then I rage quit because I can't take anymore. My record staying at one company is almost 2 years. I'm just not compatible with modern bullshit jobs funded by infinite government money printing.

> Surely it's unconstitutional.

It’s not. Free market principles are not protected by the constitution. The closest is the Commerce Clause and its mention of contracts. But that’s the idea states can’t just wipe out existing contracts (debts). The government can regulate them.

> the government should not protect people from their own negligence or ignorance

This is an extreme position to take. All governments do this.

All these people deceived, lied and committed fraud. All governments, even in libertarian utopias, prosecute such criminality and predatory behaviour

>the government should not protect people from their own negligence or ignorance - The system relies on keeping capital in the hands of intelligent, knowledgeable people; this is the foundation of a functioning system.

The government has a vested interest in protecting people because when those people are abused they don't just disappear; the government is the entity that picks up the pieces. Even if you removed the ability for the government to provide welfare to these people after they been taken advantage of, at worst they become vagrants in the streets. There's obviously a balance that should be taken but it's cheaper to prevent issues than it is to fix them.

> If the seller is honest about the asset which the investor is buying

That "if" is doing some olympic heavy lifting since we're talking about cryptocurrencies.

...the government should not protect people from their own negligence or ignorance

Oh sweet summer child how I wish this were the Zeitgeist of our time.

I don't think anyone really holds this position sincerely. Where people disagree is where the line should be drawn and how to do the cost benefit analysis of regulation.

> the government should not protect people from their own negligence or ignorance - The system relies on keeping capital in the hands of intelligent, knowledgeable people

You contradict yourself, "not protecting people" means keeping capital in the hands of fraudsters, not "intelligent, knowledgeable people".

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