>It shouldn't be the government's role to protect people from their own ignorance or bad decisions.
To what extent is a person legally allowed to take advantage of another person's ignorance or bad decisions?
Let's go extreme here. Should there be an age of consent? Yes, because we need to protect children from being taken advantage of because of their ignorance and likelihood of making bad decisions.
Thus we have already determined that, at least in some cases, the government's role IS to protect people from their own ignorance or bad decisions.
>adults should have the freedom to invest in whatever they want
What happens at 18 that means we can protect the child but not the adult? While growing knowledge and wisdom and an increase in brain maturity means we can lessen our protections, there is no justification from going from full protection to no protection on their 18th birthday (or whatever birthday you consider someone to become an adult).
Now, I'll accept that we can't protect them fully and this protectionism must be weighed against freedoms. But this is why a ponzi scheme is illegal while a lottery is not (assuming the lottery follows regulations). There is an issue with regulatory capture that we need to remain vigilant of.
And who decides if such has been done and how do they decide it?
Would this mean that using attractive people in advertising is now banned because the average person is ignorant of how the attractiveness in an advertisement impacts their impression of that advertisement? Those making the add are keenly aware of this and use it to their advantage.
>And who decides if such has been done and how do they decide it?
The SEC, just like now. You could argue they aren't as good at it as they should be, but that doesn't really change anything.
There are limits of what you can invest here, as opposed to the normal stock market where there aren't. So at least that's a plus. Nobody will in fact be able to lose their life savings here. Just 10% of it.
To what extent is a person legally allowed to take advantage of another person's ignorance or bad decisions?
Let's go extreme here. Should there be an age of consent? Yes, because we need to protect children from being taken advantage of because of their ignorance and likelihood of making bad decisions.
Thus we have already determined that, at least in some cases, the government's role IS to protect people from their own ignorance or bad decisions.
>adults should have the freedom to invest in whatever they want
What happens at 18 that means we can protect the child but not the adult? While growing knowledge and wisdom and an increase in brain maturity means we can lessen our protections, there is no justification from going from full protection to no protection on their 18th birthday (or whatever birthday you consider someone to become an adult).
Now, I'll accept that we can't protect them fully and this protectionism must be weighed against freedoms. But this is why a ponzi scheme is illegal while a lottery is not (assuming the lottery follows regulations). There is an issue with regulatory capture that we need to remain vigilant of.