They can regulate the hell out of merchants and exchanges, if they want. (And there's a lot of restrictions already: http://www.forbes.com/sites/kashmirhill/201

They can regulate the hell out of merchants and exchanges, if they want. (And there's a lot of restrictions already: http://www.forbes.com/sites/kashmirhill/2013/11/15/bitcoin-companies-and-entrepreneurs-cant-get-bank-accounts/ http://www.forbes.com/sites/kashmirhill/2013/11/15/bitcoin-c...) But I guess there's already a critical mass of very motivated and interested people on Wall st. who send a signal to legislators (whom they own) about importance of Bitcoin. If U.S. tries to shut down Bitcoin activity, it won't affect Asia, and Wall St. will have hard time going to that market. Instead, it's better if they can reap the benefits where they own infrastructure already.