I strongly agree with your opinion that many criminals use bitcoin, which is why the government does not legalize bitcoin because it is difficult to control bitcoin transactions, but it is not a crime created by bitcoin, but the community and the people themselves who use bitcoin in places wrong. Not only with bitcoin with fiat money was a lot of crime.
By using bitcoin, criminals easily make transactions without being noticed by anyone though the government. the transaction here can not be traced, therefore the government does not legalize bitcoin.
Not going to deny that, bitcoin is surely used by criminals, its because its characteristics to be used for transactions anonymously. We cannot blame bitcoin for that because it was created to be uncontrollable and anonymously, The users is the one to blame because it is the one who used it for bad things. Bitcoin is good but also bad when used for wrong.
It is also used as an easy way to steal/hold someone ransom. There are a few examples in Thailand of people known to have BTC being held up.