It's not legal but it's allowed because regulators aren't equipped to handle so many violations. There have also been some pro-crypto (under the guise of "innovation") members of Congress who have encouraged a light touch.
It's just insane the number of tiny investors that got crushed financially by the last crypto hype cycle, that they are trying to reignite another cycle so artificially and that they might get away with it seems so socially nihilistic.