There are two perspectives. The first perspective is bitcoin is living up to its promises and is censorship resistant and decentralized money. The government can't stop us from making transfers with bitcoin and they can't freeze out bitcoin or confiscate it.
If there is a unity among nations, Bitcoin can be hugely oppressed. I mean, if literally every country decides to censor Bitcoin, then its usage will be very limited but it doesn't mean Bitcoin will be stopped. Maybe it will be but Monero will not.
Bitcoin failed because it has no privacy. It was not designed with privacy in mind, it was designed to be regulated but not intentionally because Satoshi really did want bitcoin to be censorship resistant. It was supposed to be a digital revolution. Revolution means you don't let regulations control you. Bitcoin had a good vision but it was flawed by not having privacy.
If there is anything that entitles Bitcoin as failed, it's probably moments when transaction fees are high but other than that, Bitcoin is doing fine. It's still one of the most decentralized cryptocurrency compared to others and it solves the problem it was created for, it helps you to do peer to peer transactions without using of 3rd parties.
Bitcoin should have been a revolutionary movement which means it should have had privacy all along. Instead bitcoin became hijacked by investors and ROI and digital gold and regulations and no privacy.
I completely agree with you but it was inevitable and is inevitable with everything that becomes popular and massive.