No, bitcoin privacy does not run by who is adopting it or how they are accepting it, be it institution, government or private individuals does not determines bitcoin privacy, this is what determines bitcoin privacy.

• the wallet you use
• p2p mode of exchange used
• how you run your privacy and understand it.
• the  way we reveal our own identity to third parties

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Here are further solutions to the privacy needed.

wallets for security and privacy
Bitcoin Core
Passport
Electrum
Sparrow
Bluewallet

wallets security and privacy mega threads
https://bitcointalk.org/index.php?topic=5509759.0

Open Source Hardware Wallets

https://bitcointalk.org/index.php?topic=5288971.0

while for the lovers of exchanges, you can use these:

decentralized exchange
https://bisq.network/
https://hodlhodl.com/

You can see there's no way government could deprive of your privacy in any of these, except we by our own self render them access, this is more of the bitcoin network itself and not their investment, bitcoin national reserve or even ETF that can take our privacy from us.


How do they get across to a decentralized network, developers and community, impossible.