As the metaphorical policemen of the financial markets, the SEC and related organizations around the world exist to keep investment transactions fair and legal. They not only protect the innocent investor from malicious actors, but track down and punish the bad guys. Their work adds safety and security to the world’s financial markets. They’re the white blood cells of the investing ecosystem, a necessary ingredient to keeping things running normally. But their benefits often come at the expense of innovation.
So where is the sweet spot between protecting investors and fostering innovation?