countries remit/jurisdictions are their money(legal tender)/business laws. so they can regulate business and the exchange gateways. but not the peer-to-peer part.
EG send funds on blockchain, fine..
deposit funds into an exchange registered in america or swaps bitcoin for dollar.. expect the american laws to apply
deposit funds into an exchange registered in europe or swaps bitcoin for euro.. expect the european laws to apply
deposit funds into an exchange registered in japan and swaps bitcoin for dollar.. expect the american AND japanese laws to apply (ie MTGOX)

anyway regulations are stupid and dont offer proper consumer protections..
consumer protections and regulations are not the same thing.

i personally do not see a single reason anyone should advocate for regulations. but, if they instead went the route of advocating consumer protections. then that would be a good start. but still.. kep the consumer protections at the gateway/fringe/edge of the ecosystem. much like cash notes/coins doesnt need fingerprint/eye retina/ID but depositing cash/withdrawing cash using cash to buy something from a business does need the business to be legit