> This is probably why they are so popular even though the risks are ludicrous.

I'm thinking a lot of investors don't care about this and just have dollar signs in their eyes.

Yup. Whether the transaction is anonymous or not should make no difference to your decision to not to stick your capital into something which looks and quacks like a scam. Just because your circumstances deprive you of (tax free) access to investment products with market returns doesn't mean you have to roll dice on riskier negative sum bets than whatever you currently hide your wealth in. The average person chucking large sums of money at dodgy ICOs is a libertarian cryptobull with a contemptuous attitude towards the idea of legally enforceable contracts and securities laws, not a North Korean without access to a banking system.

The best case scenario is that any regular person with an internet connection and a small initial amount of capital can experience venture capital style returns. Since the most recent trend is for growing startups to delay longer and longer before going public, this is potentially a way to level the playing field, since very few people can actually invest in pre-IPO companies.

I don't think ICOs are popular because sophisticated investors with unpaid child support claims suddenly have a place to park their cash.

Yes!

This is a great example of how costly regulation actually is. I am horrified at the SEC, not at ICO's. Figure how all that moeny could be going, for example, to YC startups, for a fraction of what they give investors.

The SEC came into being because without it a bunch of people were being scammed. Which is exactly what we're seeing with ICOs. I don't see what's horrifying.

So it used to be "only white, male landowners are responsible enough to invest" and now its "only the very richest Americans are responsible enough to invest".

The SEC is blatantly discriminating. Why can't I sign a piece of paper and accept responsibility for myself? I'm a grown man with 200k+ in assets, I don't need the government to protect me.

If you're a grown man with $200k+ in assets, you appear to qualify to be an accredited investor and you don't need the government to protect you...which is the point of the accredited investor rules. You have the financial resources to absorb a few bad investments/scams. Most people don't have the resources to absorb even one bad investment.

In the United States, to be considered an accredited investor, one must have a net worth of at least $1,000,000, excluding the value of one's primary residence, or have income at least $200,000 each year for the last two years (or $300,000 combined income if married

Are you sure they are the same people. That is the people being scammed and the people asking for the SEC?

Each and every one of these regulations exist for a very good reason though. Sure, some of them could use tweaking or reviewing, but throwing then all out at once is no different than gutting the EPA.

> Each and every one of these regulations exist for a very good reason though.

Any self-made software engineer with 5-10 years working at startups doesn't have the legal capacity to buy stocks in the company he works at.

Think that as an investor, this rule eliminates 95% of your competition. As a founder, you have a much weaker position of negotiation. And as an employee, you have incredibly distorting restrictions of what you can get and how much because of this rule.

All harmful regulations exist for very good reasons.

A software engineer with 5-10 years of experience that doesn't have the financial resources to invest in a company (outside of the stock he is presumably receiving as compensation) has clearly demonstrated a lack of financial intelligence and investment saavy, and probably is the exact type of rube that the accredited investor rules are meant to protect.

And as an employee, you have incredibly distorting restrictions of what you can get and how much because of this rule. Blatantly false. An employee can receive unlimited amounts of stock as compensation. They're simply limited in their ability to expend their own financial resources to acquire stock of non-traded companies.

All harmful regulations exist for very good reasons.

Very true. But this isn't one of the harmful regulations. And even if it is harmful, it prevents significantly more and greater harm than it inflicts.

> Blatantly false. An employee can receive unlimited amounts of stock as compensation. They're simply limited in their ability to expend their own financial resources to acquire stock of non-traded companies.

Today, employees negotiate the bulk of their stock only once: when they know the least about the company they work for. Not only that, but the information they have is asymetric with investors, because share classes are not the same which makes for a very convoluted and intrasparent market. Also, the majority of startup employees that quit do not excercise their options to the fullest: but they dont have the ease to sell those options to third parties, because of SEC rules. i.e. someone not able or willing to purchase stock when he leaves a company is most likely going to lose them. All consequence of this restriccion of buying and selling stock. Check out Sharepost for an example of this unmet market that drives down compensation.

> Very true. But this isn't one of the harmful regulations. And even if it is harmful, it prevents significantly more and greater harm than it inflicts.

What's your math to make this claim. I'm willing to be convinced in a strict utilitarian sense.

That's certainly one big reason why they're popular. Many of the most popular uses for cryptocurrencies are strictly illegal.

I really doubt that. It's definitely a thing that people parrot around, but it's not likely to make up more than 5% of the actual use.

Transacting in cash USD is still the preferred currency of the cartels.

The question isn't what percentage of black-market sales are BTC; it's what percentage of BTC sales (excluding speculation) are black-market.

And a related question, which I'd love to know the answer to:

What are the other major uses (excluding speculation) of BTC?

Sending funds to family in a different country. It's a use case I have not had experience with but which I think makes sense.

Is it really cheaper or easier to buy BTC, transfer them, then sell them than to transfer money through a traditional service?

Faster and cheaper with segwit not sure what its like currently. I transferred 5k to someone in 40 seconds for like a 20 cent fee with Eth a few months ago, it could be 100k and the fee would stay the same too.

You also get the money immediately without it going through the ACH network.

That's if you already have BTC and the person you're transferring to wants BTC, but if you're simply using BTC as a way to transfer fiat money from one country to another, there are more fees and delays in the buying and selling.

The valuation of BTC is also a derivatives market of illegal activity, something which is not illegal itself.

Strictly legal? What about semi legal (legal but not everywhere) or shaming purchases (sex dolls) or discounted purchases