Why do you say they will dictate the terms? They will own the mining? The whole point of bitcoin is decentralization (unless some large entity owns mining majority).
> (unless some large entity owns mining majority).
Without control of the nodes, the mining hashpower is only a secondary concern. If the miners ever tried to enforce their will, the nodes would simply change the PoW algorithm, and the miners would effectively be out of work.
a good thought experiment. I think it's likely that the government forms a symbiotic relationship with Bitcoin if things get that far.
If the public does not want national currencies, then governments need to make them wanted. Physical force is an obvious approach, but probably impractical.
Blockchains only improve the efficiency of permissionless system. If you're going to create an in-house currency, it would be idiotic to use something as un-scalable as a blockchain.
