It seems perfectly natural and innocuous that those with the most information would want to profit from it, and doing so isn’t illegal anywhere else. So why is it prohibited to make trades based on information not everyone has? What undesirable thing does this prevent?
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[Insider trading is not always a illegal](https://www.investopedia.com/terms/i/insidertrading.asp). The article gives a decent overview. In some essence a publicly traded company is regulated so that it has some financial transparency to shareholders buying and selling. Insider trading *that is not disclosed* is antithetical to that transparency, which is antithetical to the legal and financial framework of a public company.
Sidebar: Nowadays there’s a good reason to think that blatantly unfair trading practices in the US in most markets are open for prosecution, but this definitely wasn’t always the case.
Example: until 2010 with Dodd-Frank and other finance overhaul legislation, [insider trading was explicitly allowed in commodities](https://corpgov.law.harvard.edu/2015/12/04/the-first-insider-trader-in-commodities/). Famously this was part of the [climax of the film *Trading Places*](https://www.npr.org/sections/money/2013/07/19/201430727/what-actually-happens-at-the-end-of-trading-places), and so with the 2010 overhaul the specific act of using “nonpublic information misappropriated from a government source” was banned. Insider trading enforcement was also extended into commodities markets.
Plenty of other recent examples can be found — or not — in the “wild west” days of cryptocurrency markets. [The first insider trading prosecution indictment for crypto was only last year.](https://www.justice.gov/usao-sdny/pr/three-charged-first-ever-cryptocurrency-insider-trading-tipping-scheme) In general insider trading can be tough to investigate and prosecute, which is not uncommon for financial crime, but successful prosecutions still do happen regularly.
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