If a child invests in a normal brokerage account at 3, and sells the appreciated asset at age 50, why would the LTCG be 0%?
Because the American tax system favors passive income over earned income?
The long term capital gains tax rate is officially 0% if you are in the 15% tax bracket, which is currently about $77k/year for MFJ. That means you pay nothing, as long as you realize less than $77k of capital gains each year, assuming no other income in retirement. It used to be a lot higher, under the old system in 2017, because it was the 15% bracket on top of deductions and exemptions, but those don't exist anymore.
The tax rate on investment earnings is pretty darn favorable even at higher levels. If you make ten million dollars per year in income you pay approximately 40% of income taxes, but if you sell ten million dollars worth of capital gains you only pay the 20% LTCG rate. The system is designed to penalize people who work and favor people who inherit.
And that's the easy answer, for most people who want to gift their kids. Just use your regular tax-advantaged space as much as possible (including dodges like businesses and real estate), make annual gifts up to the gift tax limit, and then pass the rest on to your kid tax free upon death (assuming you pass less than $11million).
edit: adjusted dollar amounts from 10 to 15% bracket.