You could just eliminate the regulations on who can and cannot be an accredited investor. It's a bit paternalistic to tell people what they can and cannot spend their money on in the first place tbh

True. Average people are sophisticated enough to understand complex financial instruments designed to scam them by an army of lawyers and MBAs trained at the finest financial institutions and law schools.

How does having a net worth of $1M or an annual income of over $200K inure you to being scammed by complex financial instruments?

Also, we already let people engage in sports gambling (which is guaranteed to result in a net loss) and cryptocurrency speculation, (which is a zero sum game). I'd rather give people more options to invest in financial instruments that at least in theory have the potential to be positive sum, since we're not going to ban either of the other two any time soon.

Your examples of cryptocurrency and sports gambling are a perfect example of my criticism. There are virtually no people that are sophisticated enough to succeed in either of those activities as they are all based on pure speculation and luck. There is no actual asset in either of these cases. While some modern crypto coins might be back with actual assets, many crypto coins are backed by only speculation and no actual assets. Basically they’re scams.

Yes, that was my point. Both are scams, but both are very legal. It seems dumb to bar people from investing in real, productive assets (even complex ones that might have a poor rate of return relative to index funds) when we let them "invest" in things that are guaranteed losses on average.