I'm not sure if the government is afraid that bitcoin will take over fiat. You will still need to pay taxes in fiat, which will be a portion of every transaction - sale/income/expense. Fiat will have a place in the economy because it's what people trust, regardless of its fundamental flaws.
This is exactly it. Governments probably like bitcoin because its just another thing they can tax, and banks and governments are separate entities. Lets be honest bitcoin is very likely to ever become a genuine threat to the banks as much as we'd like it to.
to tax , they may be anonymous for many years
. Hope bitcoin became very likely too . Bitcoin Boy .