The concept of an accredited investor plays a powerful role in the global financial system because it determines who can access some of the most exclusive, high-risk, and potentially high-reward investment opportunities available. An accredited investor is an individual or entity that meets strict financial or professional criteria set by regulators, allowing them to invest in securities that are not registered with regulatory authorities. In the United States, these rules are defined by the Securities and Exchange Commission, which classifies accredited investors based on income, net worth, or professional qualifications.
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