Many countries around the world have restrictions on the use of Bitcoin and cryptocurrency, but why? Can Bitcoin legalization cause economic damage to any country?

From my understanding, Bitcoin is a decentralized currency. Most of our Bitcoin transactions are done through decentralized wallets that are out of sight of the government. That means you can easily buy, sell and exchange bitcoins without government intervention. Since Bitcoin exchange is outside the eyes of the government, unethical activities such as money laundering, concealment of black money can be easy for the government. This can increase money laundering in a country, which can destabilize a country's economy.
My one question to the governments is that. The crimes that are being committed through Bitcoin or the governments are blaming those crimes are also being organized through fiat. So why is Bitcoin being blamed? Criminals will commit crimes regardless of whether it is fiat or bitcoin. But for those reasons we the people of the whole world can never accept a good invention of technology negatively. Rather, the public can benefit from the innovative technology only if the governments have good knowledge about the use of this technology and implement it in their country. Today Bitcoin is a harbinger of economic liberation so if we focus on the positives rather than the negatives we will be able to reap the benefits faster.

Do you think governments are reluctant to legalize bitcoin due to hacking or other reasons or lack of knowledge for bitcoin to be legalized in all countries? What are the government's arguments for not legalizing Bitcoin?