Not to mention the authorities have a dearth of existing legislation under which to already prosecute bad actors in the crypto space. Ponzi schemes, fake ICO's

Not to mention the authorities have a dearth of existing legislation under which to already prosecute bad actors in the crypto space. Ponzi schemes, fake ICO's and outright theft and extortion are already thoroughly addressed by existing legislation / property law. Summarily banning the thing you fine inconvenient to investigate is just lazy regulation, at best.