Most of the custodians work very hard to side step regulation and enable scams, albeit not necessarily openly on the second part, and are enabled by the on-chain primitives.

Pretty hard to avoid gov’t oversight/regulation when a USD Wire and ACH goes through the fed, for instance.

Easier when it goes through a blockchain which they can’t control.

Which is why a lot of exchanges (and all the sketchy ones) use things like Tether and stablecoins, and avoid US banks.