I'd go out on a limb here & say…
Traditional music 'already exists', whether we know who wrote it or not. It has no 'nationality' in & of itself; it could be British or Azerbaijani [to pick somewhere almost at random.] It has 'history' passed down from generation to generation until the point at which someone first wrote it down or even played it onto a recording medium. Look up the history of Simon & Garfunkel's Scarborough Fair, which owes a lot to Martin Carthy, Peggy Seeger and Ewan MacColl
Folk music is a 'genre', comprising both traditional songs & modern ones. It has many sub-genres. As a genre, all it seems to need to contain is a predominantly acoustic presentation and 'uncomplicated' chords. A folk group is likely to draw from its own national history & traditions, but not exclusively.
I'm not a great folk aficionado myself, but I've mixed/mastered a few albums for friends over the years who are. I don't recall meeting anyone who ever said they were in a 'traditional band', they were all in 'folk bands' whatever type of folk they played, from one guy & guitar, through a cappella quartets, full band with mandolins, accordions & fiddles & even electric guitars with modern drums.
Is Dylan 'folk'?… sometimes. Is Taube?… I have no yardstick by which to measure. This is completely unfamiliar to me. Yes, I'd guess.
Are Flatt & Scruggs? ... not by the same measure. Personally, I think US country/bluegrass etc has grown away from 'folk' as the country itself grew away from its origins in Europe and Africa. By the same measure 'jazz' could be considered to be entirely of American invention. It wasn't brought from one 'old country' ready-formed; it was developed entirely within the US, based on cross-pollination of many different ideas. "Trad" jazz really has a very short 'trad' compared to many other music forms. It's really only about a century old.
 I'm sure I'd used this research in an earlier answer but I cannot trace it. Someone has tracked the origins of Scarborough Fair almost back to Neanderthal times <j/k> - ....Just Another Tune - "...Tell Her To Make Me A Cambric Shirt" From The "Elfin Knight" to "Scarborough Fair" [You're not going to read all of this in ten minutes…]
 At one time, they had a weekly live radio show on the BBC which they termed "Folk and Roots". Sadly, all that now remains is footage of a few live sessions - https://www.bbc.co.uk/programmes/p001d7kk/clips