Banning crypto is only a stop gap. Eventually it will reappear somewhere. The stock market and such used to be a sea of fraud. It wasn't until the SEC was created that it got a bit better. But even now, the market is an easy place to lose all your money. Regulations aren't the savior everyone wants them to be either but it helps.

What will work best is some regulation but best of all, education of the individual investor. Make sure people know what they are getting into. Have them understand that fast money comes at high risk.

As far as regulation, the best that can be done is self regulation. Crypto is worldwide. It's not possible to mandate rules since there is no way to enforce them for all. China has banned any type of crypto activity yet there are still mining farms there. If China's authoritarian government can not do it then it's unlikely to be done anywhere else. If the Crypto industry wants people to respect them then they will have to go toward making sure that everyone respects a set of rules and ban everyone that can't abide by them thru the establishment of a self governing body.

>Crypto trading is zero-sum: Every dollar a winner makes, a loser lost.

No, much worse than that. Most of the money retail traders put in is immediately burned to pay for electricity for miners and to develop ASICs that are worthless for any other purpose. Regulators will never be able to recover that money because 90 cents on the dollar is just gone.