Diabetes is basically a state of elevated levels of glucose and insulin in your body which fucks up your metabolism.
So addiction to sugar is bad mostly because it causes overconsumption of glucose (sugar is 50% glucose, 50% fructose).
And almost everything you buy in grocery store is loaded with sugar: coke, red bull, cereal, all the sweets, cakes, pastries even things like yogurt or ketchup.
So in theory if if replaced all the sugar in all the products with this thing and it didn't have harmful effects on the body by itself, then we would greatly reduce the consumption of glucose so it stands to reason we would greatly reduce diabetes.
You can still get too much glucose by over consuming carbs (bread, pasta, pizza, rice, tomato, anything with flower) but it's much harder to eat 5 pizzas than to drink 5 liters of coke loaded with sugar.
It would still be of great benefit to replace sugar with much smaller amount of protein.
Overconsumption of sugar (glucose) leads to diabetes which leads to metabolic / autoimmune issues. Basically it fucks up your body inside.
Overconsumption of protein doesn't fuck up your body and it's much harder to over-eat protein that it is to over-eat glucose.