TLDR If you think about it, 1BTC has no problem of having a higher value than 1000$ but the government might just shut it down or outlaw it :/
There isn't any centralized point to shut down. They could outlaw it, yes, just as they outlawed most drugs (including alcohol once!), and they outlawed driving faster than 55 mph too. And in Virginia, for example, they are pretty harsh with the enforcement too, if they want to be. 20+ mph over the limit and you can go to jail (even if that doesn't happen very often in practice).
TL;DR: outlawing bitcoin won't kill it. It may temporarily hold back development.