Years in the hedge fund/CTA space left me completely convinced that the regulators were right in throwing up barriers to investing in a wider range of investments.

Outright fraud probably isn't the main risk - it's deceptive salespersonship and naivete on the part of investors about what they're entering. I don't know how we'd get a judiciary with the expertise to judge the cases.

It's not like the US makes it hard to start a laundromat with your friend, or something like that. It's about whether vulnerable people will make predictably wrong decisions about "investment opportunities".

Agree. SEC trying to "protect" people disincentivizes personal diligence. There is a broader societal problem here. Think fake news. People have been conditioned to the existence of gatekeepers everywhere, relieving them from any personal responsibility. Didn't Theranos got (or appear to get) an FDA approval [1] resulting in many "accredited" investors making huge dumb investments in that company?

[1]: https://www.nbcbayarea.com/news/local/biden-to-visits-bay-ar...

Who pays for all the investigations and prosecutions? We don’t even have enough resources to stop identity theft/electronic funds theft at the federal level, FBI won’t touch anything unless it’s over $250k.

Government doesn't have the resources to go after every fraud case so this would result in a lot of people losing their money forever.

Criminal prosecution is a ruinously expensive machine, and can't even scale down to car theft without the "efficiency" of plea-bargaining, much less $10k private investments with complicated legal agreements.