I get that they’re trying to be as minimalist on these as possible (super fly knit - and my fly knit 3.0’s are my favorite shoe), and as you suggest I would have expected that edge band elastic to be under the cut edge of the upper, and since they’re a knit upper there’s no reason that knit edge couldn’t be either fold & stitched or heat treated.
The result looks like an afterthought or a last minute compromise - even just a diecut U shaped elastic, still on top if need be, would have greatly cleaned up that appearance.
It’s kind of the equivalent of finding visible flash on a plastic part in a BMW, that sh*t just shouldn’t happen. 