Bitcoin is not legalized in some countries for several reasons, mainly due to concern over financial stability, government control and regulatory issues.
What are the reasons why some government had banned or restricted Bitcoins??
One of the main reasons why governments do not legalize Bitcoin is their failure to regulate it. This is also one of the main reasons why Bitcoin will be used illegally, Bitcoin price volatility, Money laundering, etc., etc. are irrelevant because the government of a country is very cautious about legalizing Bitcoin.
I don't think it's a failure to regulate it, most likely there are many factors why your country doesn't legalize it. Widespread adoption of Bitcoin could threaten the stability of local currencies and the difficulty of managing the monetary policies that governments have set. If many people switch to Bitcoin, demand for local currencies could decline, which could lead to inflation and economic instability. If the adoption of Bitcoin can affect the economic behavior of society as a whole, people prefer to store wealth in the form of Bitcoin, this can reduce investment in local stocks will shrink or turnover in the local economy can affect economic growth.
I wouldn't think BTC would disrupt the chains, the traditional ones, that much.
Because, after all - fiat would still be used mostly for mundane orders and transactions, not BTC.
BTC wouldn't be able to make fiat obsolete, and it doesn't need to.