It is very possible that bitcoin will lead to an increase in surveillance of payments and transactions. Where cash is being systematically phased out by governments, what will take its place, naturally, is an
electronic form of cash which is
more readily traceable. The powers that be desire the ability to aggregate large amounts of data and form predictions of behavior based on spending patterns.
Money, as a language, is a very telling indicator of where people are placing their intention and their purchasing power. The political establishment will do whatever it can to ensure that users of electronic currency (and bitcoin) are tracked, controlled, and if need be,
chipped.
Make no mistake about it, if the current political trajectory does not change, the political establishment will have their way and the surveillance of payments will be here very shortly. For those who do not comply or submit to authority, their representation on this
electronic network will be switched off like a light switch.
Although the nuances remain undetermined, what is clear is that
bitcoin empowers cashlessness. It also risks being co-opted by large mining operations. Central banks are looking at issuing their own crypto-style currency, but who will choose these over the original implementation of 2009?
There are many known unknowns in the bitcoin industry. However, what remains clear is that we have an era of total surveillance ahead of us, and bitcoin is one of many technologies which empower it.
IMO this view largely overestimates the power of the governments over Bitcoin. Yes, transactions are public, so while transactions that go through bank accounts are usually only available to specific users and the bank itself, whereas a Bitcoin transaction is available to anyone who wished to see it, basically. However, while you cannot have a bank account without verifying your ID, you can have as many Bitcoin addresses as you wish without disclosing any of your personal data. And while the government can push to require KYC where Bitcoin is used, there'll always be an option to remain hidden by using another wallet.
