While many hackers have the knowledge, skills, and tools to attack computer systems, they generally lack the motivation to cause violence or severe economic or social harm.
However, leaving everything to the market is not necessarily good for society.
Systems are complex, so controlling an attack and achieving a desired level of damage may be harder than using physical weapons.
I think most organizations have an interest in key recovery, at least with respect to stored data.
While the vast majority of hackers may be disinclined towards violence, it would only take a few to turn cyber terrorism into reality.
Everyone is a proponent of strong encryption.
Generally I'm against regulation.
I prefer leaving things to the market as much as possible.