The problem with replacing prohibition of prostitution with a partially legalized and 'regulated' prostitution is that the industry would be liable to the same same kind of regulatory extortion as other regulated industries are.
Treating Sex Work as Work | Cato Unbound: "even in looser legalization regimes, laws create perverse incentives and provide weapons the police inevitably use to harass sex workers; in the United Kingdom women who share a working flat for safety are often prosecuted for “brothel-keeping” and, in a bizarrely cruel touch, for “pimping” each other (because they each contribute a substantial portion of the other’s rent). In India, the adult children of sex workers are sometimes charged with “living on the avails,” thus making it dangerous for them to be supported by their mothers while attending university. And in Queensland, police actually run sting operations to arrest sex workers travelling together for safety or company, or even visiting a client together, under the excuse of “protecting” them from each other.
Such shenanigans were the primary reason New South Wales decriminalized sex work in 1995; police corruption had become so terrible (as it so often does when the police are allowed to “supervise” an industry) that the government could no longer ignore it."
The way to legalize something is to make it legal. Period.
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