These are some of the very important learning experiences we all have to learn from.
Crypto must NEVER be regulated. The whole point, nature, essence, strength and freedom of crypto comes from it being decentralised and unregulated. Your money is YOURS FULL STOP. So with that, the regulation and safety of it is on YOU.
We've never had such full possession, control, freedom and convenience crypto brought us. The control of our money and its safety have always been managed for us. As with anything this is an advantage of fiat currencies but at the same time biggest flaw.
Crypto changes that. We now have to learn how to keep our own money safe. We have to regulate it within OURSELVES and keep it decentralised.
The bottom line is, this scammer is obviously scum and filth, but he is not to blame. He isn't the flaw in this scam. The flaw is the people who followed his advice without due diligence.
So please identify the flaw where it truly is. Crypto cannot, must not be regulated by any central body. If you hold any amount of crypto, you are now solely responsible for all aspects of safety of your money and must learn how to keep it safe. If this sounds liike a major disadvantage of crypto to you, and do not see what advantages it brings, you definitely should learn more about finance and economics, and crypto, before holding or transfering any of it.