Law is law, code is code, both are useful tools
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The law is the law. The code is the code. A protocol can be protected by both the law and by the code. In fact I would suggest that protocol designers carefully consider applying the law as a tool to protect the intended functioning of the protocol.

The law itself is a tool. It exists to do things which cannot be done from code. It is true that many jurisdictions may be corrupt but this does not mean every single aspect of every jurisdiction is equally corrupt. If legal techniques can be used to protect a network from being attacked (such as insider attacks) then why not apply them?

Unfortunately we do not see this right now. We do see the influence of the law in crypto but most of it is in the form of protecting profits rather than protecting the functioning of a protocol itself. Patent trolls for example can in theory patent critical aspects to try to gain control over a technology. The law is more powerful than any software or hardware, even with all of it's flaws, because the law is older, has more who follow it, and agencies set up to enforce the strength of it. Law does not replace the code, and code does not replace the law.