regulations doesn't change anything about a decentralized system so you can't say it "reduces the qualities of it" either. for example when bitcoin was regulated in Japan last year, none of the characteristics of bitcoin such as decentralization, being boarderless,... were diminished. if anything it became even stronger since it opens up to a lot more people that are now running full nodes, mining bitcoin, companies thinking about getting into ASIC manufacturing, shops accepting bitcoin payments, ... it is all growth.