What I got from watching the recent hearings is an awareness that too much heaviness could drive crypto away into the arms of a more willing country. If America is conscious of losing their dollar hegemony they're also conscious that remaining a world capital of crypto is more of a benefit than the alternative.
Indeed, geopolitical competition really plays into Bitcoin's favor. Most governments (including the US) seem aware by now that driving cryptocurrency underground can only hurt their countries economically, and probably won't be effective anyway.
Still, they will try to control it the best way they know how -- by strangling VASPs with just enough regulation to see a handful of willfully compliant heavyweights emerge and consolidate the market. Or worse, they'll target users and their bitcoins
as theymos pointed out, although I think his specific scenario is unlikely.