Crypto Pumps Are Just for Fun

Crypto pump-and-dumpery.

The word “unregulated” has a sort of strange usage in finance. Hedge funds, for instance, are often referred to as “unregulated,” which their compliance teams must find frustrating. Everything is regulated. Hedge funds are not subject to the same rules as mutual funds, and have more flexibility about what they can own and how they can leverage it and what they can charge and so forth. But they are subject to all sorts of rules. There are rules that govern how they trade and what they disclose and how they raise money and how they interact with their investors, and of course there are the basic background laws applicable to everyone. If you run a hedge fund and you are charged with fraud for lying to investors, and your defense is “what, hedge funds are unregulated,” it will not—not legal advice!—take you very far. If you run a hedge fund and murder a guy and say “what, hedge funds are unregulated,” it won’t even make sense.