The standard expectation in the cryptocurrency space is that all problems are adjudicated via blockchain mechanisms (on chain, off chain, etc.) in a decentralized way. The fact that the government (a centralized, non-blockchain entity) has to step in to address a problem indicates a failure of the cryptocurrency ideal.
Is he saying that, or is he simply expressing a disdain for what he sees as anti-regulation crypto investors? He's overgeneralizing to suggest all crypto investors hate regulation, which no one believes is true. It's not even clear the majority oppose regulation in the crypto space.
The crypto ideal does not use custodial exchanges. Exchanges and brokerages have traditionally been regulated. They are convenient and not really the crypto ethos.
Since you said it was a standard expectation, you can point to polls that show this sentiment, right? Leaders of major projects saying that blockchain means stealing is ok and the government shouldn't prosecute it?
Or is it a thing you made up to win an argument. It is, isn't it. You made this up.