Lets assume that starting in USA all bitcoin to fiat exchanges are banned. Will people be still interested in Bitcoins? I believe the applications of the blockchain are many, however, most people are attracted to Bitcoins because of its fiat value (or USD value). Deep under I believe that people are really not interested in the use of bitcoins in a decentralized platform/application but more interested in converting Bitcoins in to USD. Fiat currencies still seems to be the norm. Any ideas ??
Of course the effect would be massive if conversion to fiat is disabled and its not something we have to start considering now. Its going to cause a massive blow in the current price especially if its done at the same time and effected by all the whole countries in an aggressive manner. But at the same time, there will always be away out. I know that there are some countries that major exchanges site don't allow either card or bank transfers while some others are not allowed fiat withdrawals but the trade still continues by people in groups doing using their local currency, banks, gift cards which is made possible by the availability of peer-to-peer sites and these has been working fine till date.