If governments end up really deciding they want crypto's gone... they're gone. That's my bet at least.
Music: Napster sued by Metallica. Bigass congressional hearing over Metallica tunes being shared for free online. (Really, Lars? Really? Took 2 days to download a three minute song on dial up and
you felt violated?) Ripping music CDs and P2P music sharing pissed off government and music industry corporations, and some artists. Fear mongering: ZOMG!! You're stealing from Metallica! Courtney Love, of all people, wrote a fabulous 5 page essay/commentary on the thievery of the record labels and supported *decentralization* of the industry.
And lo, record labels either adapted and learned to accept people, when given a choice between paying 30 bucks for a CD of crap they might not even like, most of which went to the label and not the band, and P2Ping any given tune for free and eventually making micro payments for what they wanted, they all chose option B.
And the government AND corporations lost to the people choosing decentralization of the music industry.
Movies: MPAA and RIAA decided the pirates were costing (them) billions. Bigass congressional hearing over it and various assorted one hit wonder actors testifying about how hard done by they were to be losing all those royalties when people illegally download/stream their movies. Then came the fear mongers and threats...we will find you and kill you!...or, find a 13 year old and make an example of him when we sue him for 49.2 billion dollars for all the movies he jacked from Pirate Bay. And let's go stop Pirate Bay! And China!
TPB came back better than ever with renewed P2P numbers and now there are all kinds of streaming freebie sites to watch anything and everything absolutely free - right alongside Netflix...because given a choice between paying 60 bucks to go to a crowded (or empty) theater and put up with idiots kicking the seat, yapping, or the kids crying, or the $12 box of popcorn, and jacking the same movie for free online, or watching their favorite tv series/shows free online, the people chose to cancel their cable tv subscriptions and haven't stepped foot in a theater in years.
And the government AND the movie studios lost to the people choosing decentralization of the movie industry and the television networks who caved and signed deals with online movie houses who charge a fraction of a movie ticked for unlimited viewing.
Books: Big name publishing houses set the rules by which any of us ever see an author's work. They had sole authority to determine who was worthy of being published and who was rejected. Until someone figured out a way to digitize books and then Amazon came along and opened up self publishing. Out came all the fear mongering and law suits. ZOMG! You're stealing food off the tables of starving authors! And self publishing? Anyone can PIRATE YOUR STUFF and you lose money!
And the government AND the publishing houses made examples of various "unscrupulous" authors faking reviews and whatnot, and held hearings on digital content prices and media harped that nobody would ever take self published authors seriously, nor would anyone choose a computer device to read on in place of real books.
And the government AND publishing houses lost to the people choosing decentralization and the ability to publish and create and own 100% of their work...so the publishing houses either adapt and promote digital format options or they go out of business.
Same for the video game industry, the electric companies, the telecom industry, and every other industry that has been controlled by corporations backed by government enforcers.
In the end, it doesn't matter what the government wants because the government isn't an entity. It's a conglomeration of smaller agencies made up of people with self interests over business interests at the end of the day and they also have a choice to support a dying currency in a weak economy or an alternative with much more security and potential for much wealth...
Bitcoin is doing and experiencing the same, exact "conflict of interest" and "threat" from the same two "entities" - government AND corporations (banks included) who have a vested interest in NOT making the USD worse than it is already...but the people have seen the reality of incompetence, corruption and psychosis of those "in charge" and are quite willing to look closer at THE ALTERNATIVE to USD.
Not everybody jumped on the internet/email/website/doing business online bandwagon the first half dozen years. Tons of people vowed it was a fad that nobody would take seriously - in the face of mega corporations, banks, and agencies moving business online. It was beating them in the face and still they hollered fad, nobody's gonna do all that, it's too hard.
Government can make all the laws it wants about bitcoin, same as they made all the laws they wanted with pirating movies, music, books, and games, or trying to regulate solar panels to pacify the electric companies who'd lose business to el sol...but ones the P2P genie is let out of the bottle, the government can't enforce a damn thing...they can't afford to pay enough people who have the technological capacity to do anything other than go after a few people to use as examples...Mt Gox may as well be Napster. May have gone out of business, but P2P music sharing is stronger than ever...
Government can outlaw it, which will only reinforce the black market. They can't enforce it anymore than the government can "turn off the internet".
Just a matter of time before the money thrown at the infrastructure gets things stable enough for Joe Blow to easily grab some bitcoin over the counter as a gift card and store it securely - and those two things will be when the rest of society gets on board.
IMO the biggest threat to bitcoin is the information overload and convoluted, overly technical aspect of learning how to get it and secure it and use it...as long as it's over the head of Joe Blow it's not going to gain traction. It just isn't.
Joe Blow can get on you tube, watch half a dozen reviews and figure out what kind of smart phone to get, go to WalMart, buy it, get the pay as you go plan (because given a choice between a corporation's 2 year $100 a month plus first born child contract plan and a $50 pay as you go card with unlimited use and no horse shit, people choose option B without hesitation), set up the account and start using the damn phone within 15 minutes or so.
When Joe can go to WalMart or the local vape shop or coffee shop and grab a bitcard over the counter, scan the barcode to set up the account via the smart phone, pay the merchant the value amount and activate the card same as a gift card, and the bitcard is also the wallet that isn't hackable, then it'll catch on.
Government is not a threat. It's just a nosey, fear mongering, psychotic pain in the ass - same as it's always been. This fight will be more interesting to watch though because the ones who control the money control civilization...and when the people choose the P2P option of currency, the government loses its control short of a tyrannical retaliation...which is the line in the sand...it won't happen in this country. No matter how lazy Suzy Homemaker is, there are millions of people who won't for one second tolerate any government official trying to pull it off without blood in the streets...which includes LEO, feds, and soldiers refusing to enforce the dictatorship.
TLDR - 1. bite me, 2. we've fought all this already with music, movies, books, games, power and they lose to p2p, 3. government aint shit, don't sweat it.
I think you're wrong for a few reasons, although I do agree with you in some aspects.
Taking this from a few different angles...
1. You cannot use Napster, The Pirate Bay, etc. to launder money.
2. None of your examples involve violence as a result of the theft.
3. All of your examples amount to the government not being able to stop piracy. The energy and traditional finance industries are where I've made my living to this point - they are still firmly controlled by the government and must obey all those regulations, of which there are many. Sure, "deregulation" as a whole has been a trend, but deregulation and decentralization (although they're admittedly similar) do not always produce similar or comparable outcomes.
4. You say, "but the people have seen the reality of incompetence, corruption and psychosis of those "in charge" and are quite willing to look closer at THE ALTERNATIVE to USD." This makes for a great soundbite, but I really just don't think it's true. Look, I don't think anybody is wrong saying the government is inherently coercive, tyrannical, etc. But the way I've thought about it: look at a developing 3rd world country. First, the rebels are petty criminals. Then they're organized criminals. Then they're terrorists. Then they're rebels. Then they're a political party. Then they win, and they're politicians and diplomats and war heroes. If they lose, they're evil people going to hell and "those scummy rebels" or whatever. But the government is just the gang/party/whatever that has the *most* legitimate *and* enforceable (that part is key) claim on ruling a country than anybody else.
But anyways, I would just disagree about this idea that the government is inevitably going to collapse. When you stack them side-by-side, the average, everyday person is going to choose USD every time. You don't need tech (as you mentioned) to make it simpler for you. You know that the world's superpower will help you collect any debt owed in USDs. You know that the currency has served its role that it's meant to in your everyday life for your whole life. You know things can go wrong, but you've lived through the last 10 years (or even better, the last 20-30) and seen the "government is collapsing under the weight of its own corruption" crowd be wrong, wrong, wrong, wrong, wrong, and wrong again. None of the predictions ever come true, which leads me to think the underlying logic may be flawed.
The everyday person can probably see that things have actually improved significantly over time, albeit at a slower pace than in the past. How can they respond that the government is inept when, in reality, we have some of the best governance in the world here in the US? Sure, there's bad things that happen in a massive country, but look at all the good. Furthermore, the Collapse Camp completely fails to address much of modern macroeconomic thought and why the monetary system works how it does. They completely fail to address its complexity and how counterintuitive it is, and so they call things like QE "money printing" and so on. But then they can't explain why all their predictions end up being wrong.
So, tldr: the everyday person will choose cash+US Legal System+US Military+superpower/reserve status trade deals all but ensuring a longer store of value than digital codes + no legal system + no backing + sketchy legality and little formal economic integration.
So I get that that's the problem BTC adopters are trying to solve, but I think that's something of a chicken/egg problem. BTC bulls seem to justify anything that reality presents them with. (Fixed supply money being a good idea, widespread crypto adoption "right around the corner", etc.)
Quick Edit: let's assume the government does not collapse in the next 15-20 years and maintains stable, relatively peaceful control, and that things generally go as they have in the past. In this "base case" (which we should probably assign at least a 40% probability based on history), what happens to cryptos? What about a "bull case" (for the USA / world economy), in which things actually end up getting significantly better pretty soon, rather than worse? What happens to cryptos then?
Furthermore, in your scenario that the global economy will collapse, or that the government will be overthrown by corruption (
http://cpi.transparency.org/cpi2013/results/ tell me why the US in particular is the one about the collapse?), why would you choose BTC as the asset of choice? There are far more investments that could yield a higher ROI and prove more practical/usable in such a scenario.
