A possible outcome is that, the harder we regulate a set of institutions as a result of the last crisis, the more likely it becomes that the next crisis occurs in the hitherto unregulated part, perhaps even among institutions that do not yet exist. If the conditions are such that people want to take risk and gear up, they will find a way.
Of course, that is acceptable provided the relevant private parties can be allowed to fail without bringing down the core part of the system. Caveat emptor can apply outside of the regulated net if there are few spillovers.