Here in my country which is now an upcoming tiger economy (though we are still classified as a third-world country), we are free to participate in Bitcoin both buying and selling as the government is treating Bitcoin just like any other foreiign money.
However, I am sure that only a very, very small fraction of us are declaring our Bitcoin income. It seems to me that the government is not that interested to get strict with individuals as long as they can tax the Bitcoin exchange provider for the service rendered.
I am then wondering the situation with other countries. Can your government really be able to track if you never declared gains made from Bitcoin transactions?
If the government has established a tax on income from activities in the crypto currency, it will unambiguously track them. Just now there are still other problems with the crypto currency. In addition, most states have not yet fully studied and have not fully determined the crypto currency, including on the methods of monitoring the collection of taxes from its use. In the future such control will be strengthened and if the government sees that people do not pay taxes, then various prohibitions and restrictions can be introduced, up to the complete prohibition of decentralized crypto currency.