I don't think it is too late by any means. There is constant progress being made in terms of peer to peer trading, decentralized exchanges, mixers, privacy wallets and techniques, and so forth.
https://twitter.com/wasabiwallet/status/1503091503207432193Cryptocurrency payment processors are also sometimes asking for KYC, if they aren't, they can be eventually compelled to do so. Even P2P trading and decentralized exchanges can be attacked, e.g. Etherdelta's founder was probably getting fined the first case and the appetite has grown since then.
https://www.wsj.com/articles/cryptos-defi-projects-arent-immune-to-regulation-secs-gensler-says-11629365401“There’s still a core group of folks that are not only writing the software, like the open source software, but they often have governance and fees,” Mr. Gensler said. “There’s some incentive structure for those promoters and sponsors in the middle of this.”
One way or another, I expect for all effort to be pursued to curtail as much financial activity as possible.
Even without any of these things, if people just stopped throwing their personal information out like confetti then much of this damage could be stopped or even reversed. The problem is all the newbies coming to this space are told by people who have never traded P2P to go sign up with Coinbase or Binance because P2P trading is too "complicated" or they are "more likely to be scammed".
Coinbase, Binance and similar sites are so popular and will remain so because they allow users to buy/sell with less friction than the alternatives.