Even criminals don't want the insane volatility of vanilla crypto, and there's an unfounded sentiment that Tether doesn't freeze value in people's wallets (they actually freeze more than anyone else, and good luck resolving it in Salvadoran court if they even have jurisdiction).

Yes classical finance has had scandals because they're obligated to prevent these things, and in general, they have responded to court judgements by upping their internal controls. Crypto is built specifically not to have either internal controls or the ability to institute them in a meaningful way. It's the fundamental premise. One system is designed to stop this activity but fails sometimes, the other is designed to allow this activity by anarchocapitalist libertarian ethos and offers roughly zero recourse for those caught up incorrectly.

This argument is tantamount to "well, a plane crashed, so obviously the FAA doesn't provide any value, and we should just stop regulating aircraft entirely and yolo it." Same with drugs, well, a side-effect happened, let's just scrap the FDA and legalize the grey market Chinese sackloads of $5 peptides. While we're at it, we should let Walgreens sell em, why not.

If you think what the classical institutions are doing is wrong, you shouldn't say well, just let 'em lol, you should be arguing for stricter penalties and more control. If you think it's right, well, I don't know what to say.

Pepperidge Farm remembers when nobody in their right mind would just give all their money to unregulated offshore banks in the Caribbean. Remind me why that was again?

The comparison is wrong. FDA is not there to confiscate anyone's money by locking down their accounts. FDA regulation is applied to companies. KYC is the US shit which applies to anyone, anywhere in the world outside the US, having the priority above local laws.

It must end.