It seems to me that the government and Bitcoin are a bit incompatible. because Bitcoin is not backed up by anything and no one influences it. As for me, I believe that the government should appear then when the cryptocurrency and it is Bitcoin that will become the world currency.
Maybe what is meant is crypto currency issued by the government. If so, that means crypto issued by the country is compatible with official fiat currencies. The effect is that the exchange rate that occurs will parallel the exchange rate of the currency.
Then, the government can intervene in the crypto owned through the central bank to prevent prices from being out of control.