I understand that for some, this is a bit of an ideological let down. At this point Bitcoin has attracted people of all political views, but it was originally very well aligned with libertarian ideals—which are of course at odds with big government, regulation etc. Realistically, however, it has always been a matter of time until regulation was put in place around it. Unless we suddenly collapsed into a state of anarchy, there is no way that the US government would permit a gigantic alternate economy to grow in parallel, organically, untouched. Failure to regulate would imply a tremendous loss of both financial and political power domestically, and from an international relations perspective likely weaken Washington’s image. It would also of course be a huge missed revenue opportunity.
** Of course there are reasons why a government might choose to keep regulations very loose or essentially non-existent, similarly to why some countries have lax tax policies, but I’m not going to delve into that here.