I suspect it's something else. The total amount of global wealth in cryptos is tiny. Insignificant. The entire crypto space could disappear and nobody would blink an eye. The entire market cap of cryptos equals reaches the value of the average Fortune 500 company.

Central banks have to deal with propping up worthless fiat, fixing bloated balance sheets, and calming petty political roils without causing a massive, global financial panic.

Meanwhile, regulators can't keep up with the pace of innovation. It's way too much effort for such a small market.

That's my perspective on the whole situation.