Protection in what? I think Bitcoin holders don't need to have a protection from the government because if someone lost their coins, it means there's something wrong with their OPSECs. If you lost your coins in hardware wallet or cold storage due to hack, $5 wrench attack, etc, I don't think the government will refund your coins.
Only popular centralized entities e.g. Mt.Gox and FTX might refund your coins, even though there's no 100% guarantee, deadline or how much they would refund.
There were quite a lot of crashes between Mt Gox and FTX. And most didn't refund. In such cases all the people who didn't understand what "not your keys, not your coins" means were crying for government protection. That's what I'm talking about.
You are right. You or me don't need that. But there are (sadly) soooo many people who simply can't take proper care of their money and don't care to read the basic rules... making us a tiny minority.
This being said... protection is good. For the many.