Bitcoin being illegal or legal is depend on the person, who use it? anyone can use bitcoin in illegal transaction or legal transaction.
which is still an issue,not all countries recognize bitcoin,bitcoin is also considered bad because the value of currencies based on market demand and has a high degree of fluctuation,not all states prohibit all financial institutions accept transactions using bitcoin,virtual currency as legal tender.
Well you are right with it, there are some countries that are not allowing their people to use bitcoin with this kind of thinking.
Because when a person uses bitcoin they are thinking already that it is being use for illegal activities, but not all of time bitcoin was being use as that.
But there is a free will to the user on how they are going to use their own bitcoin, it's either for illegal or legal things.