However, Australia's experience shows that the process of legalizing and defining the status of cryptography is far more beneficial to the state than to the users, since for the first it creates additional control and profit opportunities, and for other participants only imposes additional restrictions.
That really just about sums it up perfectly. It seemed to me like the only problem they have with Bitcoin in the first place, is that it could easily be used for criminal activities. This is clearly not the case though, with blockchain analysis and whatnot, and some governments are starting to realize it. It's a low risk additional source of revenue. For as long as legalization is done right, it's a fair compromise in my opinion.
same as dollars and other fiats, where a govt is also gaining profit thru foreign exchanges, it is empowering a state's reserves and monetary value versus other foreign currencies, it has big revenue which the govt are benefiting on cryptos, dominance and control are also one of the many benefits of legalizing cryptos, some countries even create their own cryptocurrency. because of the many uses of such.