Put another way, crypto is fine, because - look, fiatsquirrel!
Crypto is good for paying bribes, or for buying contraband without records or taxes on the transaction, for moving money across borders without declaring it. Those are all illegal, but I can see why crypto has a value for doing those things.
It may be that those activities are a lot more prevalent than I think, or that the existence of a shadow payment system will MAKE those things more prevalent.
For example, if I were in Venezuela, and I had some money and could somehow convert that money into bitcoin or whatever, then yes, do it. Then you emigrate, move to Miami, sell the bitcoin, and voila, you didn’t have to travel with a suitcase full of dollars. That would be illegal, in Venezuela, but well worth doing.