If cryptocurrencies are fully outlawed, there's nothing great for any market, because why would people risk going to jail or paying a huge fine over simply trading? They would just go back to trading stocks and other instruments, and those who want just a store of value will buy gold or the US dollar.
Don't underestimate people. China has made the practice of exchanging Bitcoin (or any other crypto) to fiat illegal by law, yet the local markets there count millions upon millons of traders who are still involved.
well, p2p trading isn't actually illegal. china outlawed trading platforms (businesses) from exchanging fiat to crypto but they didn't do anything to discourage individuals from trading. i assume this is because they could easily crack down on centralized exchanges with an iron fist. it would be untenable to effectively target individual p2p traders.