It is probably no secret that Bitcoiners are not fans of regulation. What is generally misunderstood though is that the aversion is not to regulating in general. We understand that in the real world, the big financial powers are never regulated in a practical sense. Consumers, on the other hand, are heavily regulated.
Regulations are almost never designed to protect the consumer. Instead they are put in place as a way to control the flow of consumer spending and to protect the interests of the financial sector. The New York BitLicense is a good example of this problem, as it was designed to favor credit card companies and put a burden on Bitcoin development and acceptance.
Now Coinbase has been banning user accounts that send Bitcoin to gambling sites, even though online gambling is not illegal. One Reddit user also complained that coinbase banned his account for allegedly purchasing cannabis products with coins purchased from the service.
Coinbase explains that the company is only trying to stay in compliance with federal anti-money laundering regulations and drug laws. We understand that any company has a fiduciary responsibility to protect the company for its shareholders. But it appears that Coinbase has crossed the line by not only tracking coins purchased through its service, but also tracking how users spend their Bitcoins after withdrawing them from their Coinbase wallets.
These types of practices are the very antithesis of Bitcoin and virtual currencies, and they are the main reasons why most Bitcoin users fear regulation. It is often used to regulate taste rather than safety, and it can also be used by a company to suppress the business of its competitors. These are arbitrary overreactions by a company that fears the laws that they claim to respect.