[mrb]

"a theft on banks is extremely hard and rest of the system hums along. Mt Gox and DAO however resulted in catastrophic failure where everyone was collectively punished."

Not "everyone" was punished. Only users of Mt Gox. And only investors of the DAO. Also both Bitcoin and Ethereum survived these incidents very well.

With legacy financial systems (banks, cash) there are plenty of scenarios where you may never get your money back, eg.: lose your wallet/cash, 2016 Bangladesh Bank SWIFT hack where $60M was never recovered, etc.