Not sure in this case its the regulators.
When I first saw it was being discontinued I thought Spyderco was giving up on autos and guessed, like you, that they were tired of dealing with the regulations (and regulators

).
But if that was the case they would not be planning an "ungraded version" of the Citadel and putting out the new Autonomy.
Note in Sals comment that the Citadel hasn't been made for years, which would indicate it wasn't a big seller. It's really not that hard to buy an auto if you really want one, so I'd guess the Citadel just never got hugely popular with auto buyers.
Sort of surprises me because I think it is darn decent for the price.
Could be it was too expensive for the folks looking for a cheap auto, and didn't quite have "the look" or wow! factor for enough folks willing to spend more.
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