I don't know, but I feel like the government just want to control the mass. From what I know, they've been trying to control Bitcoin ever since day one but since it's decentralized, then they know they can't.
This might just be a turn around for them as if they buy and reserve bigger portions of Bitcoin, they can then control it using price. Maybe sell off when ever they wish which in return would cause a very big dump in the market, scaring out the little investors to sell off much quicker.
Most at times we mistake this buying by the government as something, the government will be hardly going to buy bitcoin publicly and that’s why we hardly see China which is been rumored to be buying purchasing bitcoin publicly. Yes this will affect the adoption rate, for me it will speed it up but one thing is government wouldn’t be getting the control of it that most of us are presuming.
Since the coming of bitcoin ETF and even institutional investors like Microstrategy have there been any manipulation when this people buy? I don’t it has affected the market much. When this people buy yes there is a spike in the market but most often it doesn’t affect market for long. That’s why even though we hear everyday about ETFs buying chunk of it everyday the market doesn’t move like that. The only time I think the government involvement will affect the market more is when they actually put out a policy that affects the investors sentiment