As far as I understand DUSK are researching a way to have a hybrid approach, one that combines decentralization with regulatory necessities. Check this FAQ:

Dusk Foundation wants to work with regulators, yet it's building a privacy platform. These two cannot be reconciled - why would a regulator work with a platform that removes government surveillance power?
This is a misconception. In democratic societies, privacy is very well accepted and even enforced at legislative levels by policy makers. An example is the GDPR. Another is the SEC enforcing secrecy to trading bodies in the stock market to prevent price manipulation. The Dusk Network provides the same level of privacy enforced by regulators. Only, it eliminates the “trusted third party” and returns the power of disclosure directly to the user.

For instance, in the case of payment, it is the responsibility of the wallet holder to show the details of the transactions on request of the auditors (by providing a view-key). In the use case of security, compliant confidentiality is achieved with KYC built in the protocol and the use of zero knowledge accumulators to keep the whitelist confidential.