I like how you mention two technologies that governments created. 1. Gold and silver coins were created by governments. 2. Tor was created by the government.

I like how you mention two technologies that governments created. 1. Gold and silver coins were created by governments. 2. Tor was created by the government. When you convert USD to bitcoin, that USD doesn't disappear, it still exists in the private sector economy. Nor does bitcoin increase the money supply of USD. That supply is controlled by the government. What happens when the IRS cannot tax the bitcoin transactions is that more USD remains in the private sector than normally would. This does not cause financial problems for the government (Since government makes USDs anyway). More USD in the private sector means at worse rising prices, and at best an economic boost.