From recent news in India it is heard that bitcoins are used to sell drugs..I know its a currency and it is also used as a normal money... but these can create a bad space in people's mind that bitcoins are used to sell drugs..so they will not use bitcoins... Conclusion is that BTC is also a currency which is having a high value in the market..and bitcoins must not be used in these illegal activity which can reduce its usage and value.
Rumors has it that bitcoin is used to for illegal activities like payments for weapons and payments for drugs but i dont think that this activities would reduce its usage and value, it is on the other hand would increase its value because it would increase the users and the more demand for bitcoin the more its price would increase.