It should give confidence to investors that no funny business is going on. But instead people hear exchanges are getting inspected and everybody sells there coins. Bitcoin is getting very frustrating and I'm starting to think it does indeed have a low ceiling.
This is what I called unnecessary panics and its something one should be weary of. But the reason for going that is kind of justifies because people believe when that is happening, then my anonymity is no longer guaranteed in which the simple "checking" might lead to other forms of investigation which I am sure people are not ready for but at the same time its good it will take time for it to sink that its actually in everyone interest.