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 So the lesson you learned is that we need to comply better? 
 Looks like telegram didn’t have default on encryption and failed to monitor the unencrypted content for illegal materials. 

Lesson is don’t be a dumbass and encrypt by default or be prepared to comply … 
 That is not feasible for apps where data is more valuable than ephemeral chat.

imagine if Google Drive started encrypting by default, the amount of people that will lose their data (when they never asked for encryption in the first place) will kill the app. 
 Google is huge, they likely have automated scans of all drive content and additional human moderation 
 But that's the point, this regulation kills any competition, unless the competition enforces e2ee like you said, and then most users will stay away because they will keep losing their encryption keys.