In the developing world, having high remittance flows (such as sub-Saharan countries) or being unbanked will make cryptocurrency very attractive for the population in general. But I'm not sure if the government themselves embrace the cryptocurrency.
Here's a thought: If you were to come up with a cryptocurrency, what features does it need to make a country supportive of it?
It has to be decentralized, and the people and government/authority both willing to use it long-term.
1. What kind of situation would a country have to be in for it's government to support its population using cryptocurrency?
"Support" here should be understood as concrete changes like accepting payment or transactions using a cryptocurrency, or investing in them.
Political parties may be raising funds by creating their own tokens, but these aren't likely to be the accepted currency for everyone in the country. On the other hand, there may be cryptocurrencies used to bypass trade sanctions: Would this be an example of a cryptocurrency accepted by both the people, the government and usable by more than one country (at least, their allies)?
2. A related question would be: What kind of government system would be most accepting of cryptocurrency?
Feels like adoption of cryptocurrency will be most resistant for countries with strong currency, and vice versa. A person living in a country plague with conflict and unrest will also find cryptocurrency appealing, though in regards to this topic, there is no "central authority" in a state, is there? Would the system of government affect how appealing cryptocurrency is? (Or do you believe any government would reject it?)
Question for fun: In a zombie apocalypse, is cryptocurrency more useful as a medium of exchange (assuming the infrastructure like internet is working)? I would assume it would make it easier to safeguard your accumulated resources and let you travel with less burden.
3. Design
In your replies, I am also interested in how you would the design of the crytocurrency model: what are the incentives to "behave well"; and will it be design for use in a region, or globally (I assume the cryptocurrency will have a targeted user, as global population have too much economic, societal and political differences).
Assuming you believe cryptocurrency will never be attractive to any kind of government, then:
Would blockchain technology be adopted? If yes, how will it be used?
(This is assuming the governmental body has a basic/informed understanding of what blockchain technology is.)