I am reasonably confident that people pre-order items, and are charged for them before they ship, all the darn time.
For the OP to combine two entirely separate things--1) I think it's a bad solution, and 2) and it's illegal to charge money that way--makes it just seem like he has an axe to grind. Those things have nothing to do with each other. The security issues are at least related to the technology, and he could have brought them together: "I think it's a bad solution because it involves challenges to doing it securely, as demonstrated by..."
I think the pre order issue is that most credit card companies require that a pre order is just an authorization on the amount, not an actual transaction. The money isn't supposed to change hands until the item is shipped.
Coin is completing the transactions and using the money to fund their venture.
It probably isn't black and white either. I am no expert on credit card transactions.
For the OP to combine two entirely separate things--1) I think it's a bad solution, and 2) and it's illegal to charge money that way--makes it just seem like he has an axe to grind. Those things have nothing to do with each other. The security issues are at least related to the technology, and he could have brought them together: "I think it's a bad solution because it involves challenges to doing it securely, as demonstrated by..."
But the payment stuff? Come on.