Often it's neither whim nor regulations, but simply bureaucracy. Mistakes happen.
Cryptocurrency advocates promise you freedom from everyone else's action, but at the cost of no way to correct mistakes. So if your computer security is ever 100% less than perfect, or you're defrauded by your counterparty, there's no way to recover the loss. (Well, there's legal action, but "freedom from legal action" is also cited as a benefit..)
I was about to argue that cash is just as susceptible to "theft". But then you brought up the freedom from legal action. That's a good point. At least with my dirty-dirty fiat dollars, you rob from me, my "forcefully taken money" (taxes) funds a group of people that will at least go after that person. Obviously, that's not a guarantee. But it's better than a system where it sums up to "Yea, sucks for you. We don't believe in legal action of any form and built it up in a way where you're screwed."
Cryptocurrency advocates promise you freedom from everyone else's action, but at the cost of no way to correct mistakes. So if your computer security is ever 100% less than perfect, or you're defrauded by your counterparty, there's no way to recover the loss. (Well, there's legal action, but "freedom from legal action" is also cited as a benefit..)