Possibly happen if the government joined to Bitcoin, also if they seems that Bitcoin will earn a lot, they can use them power to manipulate the Bitcoin live in the market. Because if the price in the market were high, government will gained them.
The government will never gain power over bitcoin. This is a system that can not be controlled by any side. Bitcoin is free and decentralized. Nobody can manipulate the price
Of course the government will not legalize bitcoin because it can add the strength of bitcoin to be stronger and it makes the potential of bitcoin to shift the local currency will be greater.