The crypto(currency) wars of 20s ARE doomed to failure. Restrictions on cryptocurrency were ultimately about controlling algorithms with certain inputs. Its trying to make some math illegal.
There is no good faith outcome that can continue from this, it shuts down the argument.
Good day.
You don't have to drive something to zero to restrict it successfully.
Let's say Bitcoin was strongly regulated globally. Anyone caught running mining software or transacting in Bitcoin has their hands cut off. Ouch.
I can still download mining software and run it on my computer, and connect through the network through Tor. Blocks are 1 MB every 15 minutes, it's noise. I don't need to know anyone or have anyone's identities. It's really really hard to catch me. Like, wayyyyy harder than the child pornography example.
Well, ok but what's the incentive then for me to use Bitcoin in such a world? Not sure there, like what's the "USD price" per Bitcoin. Ya this part seems tough. If all countries strongly ban Bitcoin with harsh penalties, that seems like it would put a kabosh on my ability to turn it into real world currency. But still could be used for digital goods.
You're forgetting black markets. Drug dealers and gun runners and human traffickers are already breaking serious laws. They don't care about breaking other laws. If they get caught they're already going to jail whether they use illegal math or not.
The lack of utility also assumes that all countries would ban it, which seems unlikely, if only because some countries have the incentive to do anything they can to stick it to other countries they don't like. Then it still retains value globally because it can be turned into real stuff in those countries.
The real issue is this: You can't ban it for the "bad stuff" that gets used as the excuse to ban it, because those guys will just break the law, as they already do. You can ban it for innocent people using it for innocent things, but that's just stupid.
Or corrupt, because incumbents don't like the competition, which is the strongest driving force for such laws.
It's not all that long when you think about it.
You don’t outlaw the maths. You outlaw people holding assets in wallets. Courts will have no trouble distinguishing that from a ban in maths.
Your reasoning that it's "the maths" that makes crypto unassailable shows a lack of understanding of how governments exercise power and control. The law does not care about your worldview and geeky conception of the abstract mathematical nature of cryptography—and guess what—they don't have to: it's purely a question of enforceability.
The different between encryption and cryptocurrency is that the former cannot be targeted, but the latter can. Consider the purpose of encryption: to make communication between 2 or more individuals private. This can happen in many different ways, from whispering in ones ear, to using postcards w/ one-time pads. It can't be regulated because there's no stable target, any group of people that needs privacy can rig up their own scheme independent of all others and change it as necessary. The value they derive is directly from the privacy and depends unqiuely on each situation. The only way for a government to defeat this is through oppressive totalitarianism with direct threat of violence and imprisonment.
Cryptocurrency on the other hand has no direct utility other than its monetary value, and that monetary value is a direct function of the global belief in that value. It would be exceedingly easy for a government to make a specific cryptocurrency illegal because the mechanisms are concrete and public—you can't just swap out the maths for a new implementation. In other words governments can outlaw and devalue cryptocurrencies faster than you can establish and build trust in them.
Not that I think this will happen in practice because governments are already taxing cryptocurrency and riding that gravy train as well. But the fact that they are able to tax it is clear evidence that cryptocurrency is not in fact above the law.
Also, unlike drugs and alcohol, Bitcoin is a digital good with no physical footprint, making enforcement much more difficult. With an open-source protocol running on some 12k nodes as well as thousands of miners, most running on Tor - it seems unlikely that a gov could take the network down or even prevent their citizens from participating in the network.
At best, governments could block fiat on/off ramps, pushing bitcoin trading to decentralized exchanges or p2p transactions for trading to/from fiat. There would also be black markets for Bitcoin just as there are black markets for many other things banned by governments.
Ultimately governments banning fiat on/off ramps for Bitcoin could help achieve a goal shared by Bitcoiners of a native Bitcoin currency-based economy. Governments banning bitcoin may even be good for Bitcoin adoption, though it would negatively impact price in the short term.