I'm not buying it. Look at Matrix and tell me it's holding them back.
What's holding them back, perhaps, is not having a shitton of money in the bank like Signal, and they're actively supportive of decentralization which costs developer resources. Signal (or Matrix, for that matter) could not spend dev time on decentralization and just let the open source community do its thing. But that's not what Signal is doing, they're instead actively hostile towards it.
Or look at Telegram, they have an open network and third party clients. There also are unofficial clients that some people use. But what does the 99% use? The official clients. Signal's argument is that people might use insecure, unofficial clients. In practice, that's not what your average mom will do. (And it's not as if the official Signal app was audited either.)
I'm also not buying the "China can move faster" thing. They can be more oppressive without consequences, but is that really better? Does that "centralized dictatorship" allow them to be "more stable"? It's easy to say, and easy to see how indeed an oppressive government's decree can change things from one day to the next, but on that scale I think you need to consider more things than I am qualified to do before you can really say whether that is a superior system in a given situation.
I guess we conclude the same thing in the end, though, as you say "The internet is too important to herd all our services into control of dictators, no matter how benevolent."