I agree - I'm an attorney. But are we picking and choosing here? Because my bet is, and has been for quite sometime, that when all is said and done, the 'regulations' we are talking about are those that already exist and are applied to securities.
The innovation also might also shift political attention to some drawbacks with the current regulatory regime that could use updating - for instance the rather blunt instrument of the accredited investor regime, or the custodian requirement.
And the regulators will have to deal with changes to their own incentive structures - for instance the opportunity for regulatory arbitrage.
For all the mistrust of banks and regulators in Bitcoinland, having those institutions take you seriously is what winning looks like.