A variety of unscrupulous business people have wanted to call their software "open source" as a marketing tactic without adhering to the terms of the Four Freedoms. This practices is derisively known as "openwashing" or "FOSSwashing" and is a good way to alienate the cadre of senior hackers who are strong believers in the Four Freedoms, the ones who make FOSS a successful movement in the first place, and garner bad publicity. You are better off avoiding such deceptive marketing practices.
When I read the 4 freedoms listed here, it seemed that the Elastic license upholds these four freedoms. The only thing you can't do with the code is sell a hosted version of it. Am I reading that right?
That is a restriction to the *Freedom 0* : The freedom to use the program for any purpose
The purpose being to earn money by providing a hosted service using the software.
It also puts a limitation on *Freedom 1*: The freedom to study how the program works, and change it to make it do what you wish.
By preventing circumvention of licence key functionality.
That said, I believe those are reasonable restrictions. Any freedom without some limitations in how you can use them is unsustainable in the long run.
I am also considering Elastic Licence v2 for future software that may be monetised. But I would call it source available[1], and not free / open source to avoid confusion.
[1]: https://en.wikipedia.org/wiki/Source-available_software),