That's true - but arguably orthogonal to the topic of fiat vs. crypto. Yes, the government uses coercive force to interfere, but that's very often to counteract various failure cases of the free market. Another thing that makes prices fail is information asymmetry - which, in reality, is a constant of trade.

Crypto or fiat, there will never be a totally unregulated market that works.

In a way, it's like Star Trek TOS epispode "A Taste of Armageddon" - you can't replace war with a simulation (and then voluntary euthanasia). You won't resolve international conflicts through a friendly match of Q3 Arena. It's an unstable situation, because anyone who disagrees with the result can just pick up a club, or a gun, and force their own result - at which point you're back to square one. And so it is with unregulated markets: someone feels cheated, picks up a gun, and you're back to some form of governance.