The Adverse Selection of Crypto Regulation

This really should be titled "The Adverse Selection of Inadequate Crypto Regulation".

Yes, there are arguments about the state not being able to do regulation well, or what have you, but can anyone seriously advocate that without any regulation crypto markets wouldn't all be pyramid schemes or rug pulls? I'd say there's an analogy to post-Silk-Road underground markets: lots/most of them have been rug pulls.