So, are you arguing that online network activities are not subject to the jurisdictional laws on which they take place?

Who enforces laws? Who resolves disputes? Without a clear authority, you’d risk power vacuums, where unaccountable entities (corporations, rogue groups, or even the proposed AI agency itself) could dominate over others. Relying on nation-state authorities over digital networks solves all these issues. And you can physically leave the one you don't like.