It's far from clear to me why on earth crypto should be free from regulation at all.
The regulators are supposed to be protecting who from what exactly? And at whose expense?
So far I've seen two lines of reasoning:
1) Regulators are needed to protect me from myself. I can't assess if these dog-coins have long-term investment potential or not, so I want the government in the loop somehow. If I can purchase something on the internet, I assume it's safe, or the government wouldn't let it be sold.
2) Regulators need to protect the government from the effects of money laundering. I must give up privacy for the greater good, as the money laundered by North Korean hackers will be used against my country. Giving up all privacy in exchange for a small reduction in the funding of our enemies is always a good trade.
Even if I buy one of these arguments wholeheartedly, the practical matter is that we're trying to prevent math from being done here, and it's just not going to work. It's sort of like preventing piracy.
But public sentiment has become very anti-crypto, so I suspect we'll land in a war-on-drugs type situation where the crypto never really goes away and you can still transact it anonymously, but we mostly just don't talk about it except for the occasional bust to ensure more enforcement budget next year.
Also, Ethereum could adopt privacy by default some day, via their proposal process.
It's fascinating to watch regulators talk about "bitcoin" and "ethereum" as if they're "gold" and "oil", unchanging commodities that just need to be categorized and dealt with appropriately.
Ethereum is totally publicly visible today, but it does not need to be that way tomorrow. These are living projects.