Then why not scrap the Howey Test (which was out forth as the definitive test to determine if an investment is a security) and just keep the existing fraud laws?
Security law is in place for good reason, to protect investors.
Fairness actually is the point sometimes. Obama talked about raising capital gains tax, even if it results in lower money for the government, simply for reasons of fairness [1][2].
That’s not law. It’s exactly the kind of thing the rule of law is supposed to prevent. What constitutes “ripping people off” is an incredibly political and ever-shifting judgment. We vigorously debate and make laws, so that everyone knows what is allowed and what is not, regardless of what they think the law should be.
> What constitutes “ripping people off” is an incredibly political and ever-shifting judgment.
I think that for the example given, ICOs, the opposite is true.
For "most" of these situations, whether something is a straight up scam or not is very obvious. And I am glad that the SEC has chosen to mostly go after the scams.
Sure, grey areas will come up. But what does it matter if the grey areas are less than 1% of the market?
There are certainly cases in the world where the nitty gritty details matter, and that there are huge grey areas. I just don't think the ICO market is one of these nuanced cases.
What the SEC cares about is whether uninformed investors are being ripped off.
What matters way more than the letter of the law is whether people are being scammed.
Ans I don't think this is a bad thing. The whole POINT of these laws in the first place is to protect people from being ripped off.
And if you ARENT ripping people off, then the government probably won't go after you.
Fairness isn't the purpose. The purpose is to protect people.
And if you don't hurt anybody, well what was even the point of the law to begin with? No harm no foul is a perfectly reasonable philosophy.